Small Companies: Do you know about the advantages of obtaining an SME status?

by Dr. Annegret Vaggelas

Small biopharmaceutical companies are powerful engines of innovation, however, typically lack the resources, funding and expertise compared to big pharma companies. The European Medicines Agency (EMA) addresses the unique needs of micro, small and medium-sized enterprises (SMEs) through specific incentives – accessible through the SME status. For example, the most immediate and obvious incentive for early development stages is to save 90 % or more of the scientific advice fee which could go up to 80,000 EUR. SMEs inside and outside of the EU can obtain EMA’s SME status if certain criteria are fulfilled.

Annegret Vaggelas explains the requirements, the incentives, and the process to obtain the SME status. 

The European Medicines Agency (EMA) provides incentives for micro-, small- and medium-sized enterprises (SMEs) that are developing human or veterinary medicinal products with the goal to promote innovation and development of new medicines.  The regulation behind these incentives is Commission Regulation (EC) No 2049/2005 which was adopted on 15 December 2005.

What is an SME?

The main factors determining whether an enterprise is an SME are (1) staff headcount, and (2) either turnover or balance sheet total. Commission recommendation 2003/361/EC defines an SME as a company established in the European Economic Area (EEA) with fewer than 250 employees, and an annual turnover of not more than 50 million euro or an annual balance sheet total of not more than 43 million euro. These ceilings apply for individual firms only. A firm that is part of a larger group may need to include headcount/turnover/balance sheet data from that group too.

What are the incentives?

When the SME status is granted companies can take advantage of administrative, regulatory and financial support provided by EMA, including:

  • regulatory assistance
  • fee exemptions and reductions
  • assistance with translations of the product information required for the granting of an EU marketing authorization
  • workshop and training sessions

Especially the fee reductions are substantial. For e.g. Multidisciplinary Scientific Advice Procedures a fee of around 8,000 EUR applies instead of around 80,000 EUR (for more details about fee reduction refer to Table 1). In general, to apply the financial incentives the SME status has to be assigned by the agency before a regulatory submission. Therefore, companies are advised to consider SME registration early during the development.

Table 1: Financial incentives for SME status


What is the SME office and how to register for SME status?

To offer assistance to SMEs, the SME office has been established, which tasks also include providing contact with relevant scientific and regulatory staff within the Agency to help address any questions early during product development.

For registration, companies have to fill out the form ‘Declaration on the qualification of an enterprise as micro-, small or medium-sized enterprise (SME)’ and submit it to the SME Office. Annual accounts, information on ownership and proof of establishment in the EEA should be included as additional documentation.

Can Non-EEA companies benefit?

Non-EEA companies can take advantage of the SME incentives directly, in case they established a subsidiary in the EEA, or indirectly, through an EU established SME regulatory consultancy in case both, they and the client, meet the SME criteria.

What can we do for you?

Biopharma Excellence is registered as a valid SME and can act on behalf of non-EEA companies. Moreover, we offer assistance during the SME registration process and the preparation of the application package. Please let us know if we can support you in any way and do not let slip the opportunity to profit from the substantial benefits for SMEs. DON´T HESITATE TO CONTACT US!