EU’s Urban Wastewater Treatment Directive could lead to additional costs of nearly EUR 1 billion in Finland alone, posing a serious threat to medicine availability

ORION CORPORATION
PRESS RELEASE
13 FEBRUARY 2024 at 8.00 EET

The EU’s Urban Wastewater Treatment Directive, which entered into force on 1 January 2025, obligates the pharmaceutical, cosmetics, and hygiene products industries as manufacturers in the so-called extended producer responsibility system to cover the investment and maintenance costs of the removal of micro-pollutants from wastewaters. The estimated costs exceed the European Commission’s estimation tenfold. The rise in costs threatens to endanger the availability of medicines and weaken the competitiveness of the European Union.

A cost estimate by VTT Technical Research Centre of Finland* shows that the investment and construction costs from the extended manufacturer responsibility will be 280–816 million euros in Finland alone. For Finland’s seven largest wastewater treatment plants, the costs are estimated to be around 237–353 million euros. For the 71 medium-sized treatment plants, the combined investment and construction expenses are estimated to be roughly 46–463 million euros, depending on risk assessments. For comparison, the total sales of pharmaceutical products at wholesale prices in Finland was 3,091 million euros in 2023.

The EU’s previous estimation of annual costs for Finland was 13 million euros. The pharmaceutical industry considers this estimation used as a basis for the directive to be completely underestimated. The pharmaceutical industry now finds it essential that a meticulous impact assessment of the directive is carried out in Finland. An impact assessment is necessary to ensure the implementation of the directive is sustainable for society and patients.

Costs brought upon by the directive are large in scale and bring a real risk of decreasing drug availability in Finland. Finland is a small market, and the additional costs caused by the directive can make it unprofitable for companies to maintain their current range of medicines. Society must consider actions to secure the availability of medicines for patients also in the future. The traces of drugs found in wastewaters are mainly caused by the normal use of medicines, not drug manufacturing.

Society must contribute to sharing the costs related to the extended producer responsibility with the share of 20% permitted in the directive. Due to current price regulation, pharmaceutical companies are not able to absorb the increasing cost burden in their pricing as per the “polluter pays” principle. The societal expense share of 20% is a key tool to minimize the impact on medicine availability.

Patients are the ones suffering the most from a diminishing drug selection. The pharmaceutical industry is calling on policymakers to secure this funding.

Medicines are critical and essential commodities for maintaining the health and working capacity of the population. Profitability is a prerequisite for the production and marketing of pharmaceutical products in the EU. This is particularly important for small markets such as Finland. EU legislation must consider the need to support European competitiveness and industrial capacity so that medicines can be manufactured and traded in EU countries without compromising medicine availability or patient care.

Only two industry sectors have been allocated the costs of additional wastewater treatment, which does not create an incentive for other sectors to reduce micro-pollutants. The pharmaceutical industry must be seen as a part of the EU’s strategic autonomy in which self-sufficient manufacturing is strengthened, not hindered. The current regulation does not support the conditions for an RDI-intensive industry in Europe or allow, for example, the establishment of new antibiotic manufacturing capacity in Europe.

In general, the aim of the directive to protect the environment from the harmful effects of inadequately treated urban wastewater is very welcome. Pharmaceutical companies are committed to addressing environmental concerns and have long been working proactively to reduce the environmental burden of pharmaceuticals.

Contact persons:
Liisa Hurme, President and CEO, Orion Corporation
liisa.hurme@orion.fi, tel. +358 10 426 2874

Anne-Mari Virolainen, Managing Director, Pharma Industry Finland
anne-mari.virolainen@pif.fi

Heikki Bothas, Executive Director, Rinnakkaislääketeollisuus ry heikki.bothas@rinnakkaislaaketeollisuus.fi

*Mona Arnold, Mika Naumanen and Inka-Mari Sarvola. 12/2024. The costs of the Urban Wastewater Treatment Directive reform - removal & management of micro-pollutants. Commissioned by: Orion Corporation, Pharma Industry Finland and Rinnakkaislääketeollisuus ry.

Publisher:
Orion Corporation
Communications
Orionintie 1A, FI-02200 Espoo, Finland
http://www.orionpharma.com

Orion is a globally operating Finnish pharmaceutical company – a builder of well-being for over a hundred years. We develop, manufacture and market human and veterinary pharmaceuticals and active pharmaceutical ingredients. Orion has an extensive portfolio of proprietary and generic medicines and consumer health products. The core therapy areas of our pharmaceutical R&D are oncology and pain. Proprietary products developed by Orion are used to treat cancer, neurological diseases and respiratory diseases, among others. Orion's net sales in 2023 amounted to EUR 1,190 million and the company had about 3,600 employees at the end of the year. Orion's A and B shares are listed on Nasdaq Helsinki.