Europe’s plan to make pharmaceutical and cosmetics producers pay for wastewater treatment has suffered a legal setback. An Advocate General at the EU’s top court has recommended annulling the provisions behind the scheme, citing serious flaws in how the EU assessed the sectors’ contribution to micropollution.
Advocate General Juliane Kokott issued the recommendation on Thursday after Poland challenged the new wastewater rules. The legislation requires pharmaceutical and cosmetics companies to finance at least 80% of the additional treatment needed to remove micropollutants from urban wastewater.
Ms Kokott identified significant shortcomings in the evidence and methodology used to assess how much micropollution came from the pharmaceutical and cosmetics industries. She therefore recommended that the Court annul the provisions requiring those sectors to finance at least 80% of the additional treatment costs.
“Clean water and essential medicines are both public goods; Europe should not sacrifice one to advance the other.”
— Steffen Saltofte, President of Medicines for Europe and CEO of Zentiva
Kokott also questioned the methodology used to calculate the sectors’ “toxic load”, including the data used for some pharmaceutical substances, and found that other potential sources of micropollutants had not been adequately considered.
She concluded that the 80% cost allocation was based on a flawed assessment and recommended that the relevant provisions be annulled. Her opinion is not binding, meaning the Court of Justice could still uphold the rules in its final judgment.
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The pharmaceutical industry welcomed the opinion. “Clean water and essential medicines are both public goods; Europe should not sacrifice one to advance the other. This opinion materially strengthens the case for pausing the implementation of the EPR (extender producer responsibility) scheme,” Steffen Saltofte, President of Medicines for Europe and CEO of the pharmaceutical company Zentiva, told EU Perspectives.
Mr Saltofte called for a pause and a thorough review “to ensure the legislation protects the environment without creating avoidable risks to medicine supply and availability”.
Similarly, the European pharmaceutical industry federation EFPIA welcomed the opinion. It supports making producers pay for the pollution they cause but argues that pharmaceuticals and cosmetics should not carry most of the cost when micropollutants also come from other sources.
EFPIA called for a new examination of the costs and the different sources of micropollution. “We now ask the European Commission to pause the implementation of the Directive while an adequate, comprehensive and transparent impact assessment is conducted to identify all relevant sources of micro-pollution,” Director General Nathalie Moll said.
“Today’s opinion strengthens the case for stopping the clock on this Directive to avoid consequences for the availability of medicines for patients.”
— Adrian van den Hoven, Director General of Medicines for Europe
Medicines for Europe urged the Commission to pause implementation rather than wait for the final judgment. “Today’s opinion strengthens the case for stopping the clock on this Directive to avoid consequences for the availability of medicines for patients,” Director General Adrian van den Hoven said. The organisation warned that additional costs could cause companies to discontinue some medicines, reduce supplies or move investment away from Europe.
Contributions will become payable in 2029 but will be calculated using sales volumes from 2028. Manufacturers therefore say the expected charges will soon influence decisions about which medicines to produce and supply.
Industry estimates exceed EU projections
The final cost of the scheme remains uncertain. The Commission estimates that advanced wastewater treatment will cost between €1.48bn and €1.8bn annually by 2045. Pharmaceutical groups say estimates produced by some national authorities are considerably higher.
As EU Perspectives reported in March, the Commission previously rejected calls to reopen the legislation. It argues that producers should contribute to removing pollution associated with their products rather than leaving the entire cost to taxpayers and water consumers.
The Court’s final judgment will determine whether the challenged provisions can remain in force. Until then, governments must prepare to implement rules that may still be annulled, while manufacturers face uncertainty over costs they warn could affect medicine supplies and prices.
