This year promises to be an interesting one for a range of stakeholders. Several regulatory developments are underway across the EU and the Baltics, particularly in the areas of biotechnology and medical devices. In this month’s Life Sciences & Healthcare newsletter, we bring you:
- key aspects of the long-awaited European Commission proposals for the Biotech Act, and the proposal to amend Regulation 2017/745 on medical devices and Regulation 2017/746 on in vitro diagnostic medical devices;
- a progress update on the transposition of the Urban Wastewater Directive in the Baltics;
- key legal developments in the Baltics, encompassing a range of areas, including regulatory sandboxes, medical devices and healthcare reimbursement.
These changes present both opportunities and challenges for stakeholders operating in the sector. In many cases, the changes will result in a reduction of the regulatory burden on stakeholders.
Promoting the growth of biotechnology, biomanufacturing and other health sectors
On 16 December 2025, the European Commission published its long-awaited proposal on biotechnology and biomanufacturing, which is intended to promote the growth of multiple health sectors. Regarding biotechnology, the proposal includes the following changes:
- establishment of health biotechnology strategic projects and high-impact strategic projects that receive multiple benefits from priority access to funding, support, and accelerated procedures;
- extension by 12 months of the Supplementary Protection Certificate for medicinal products developed by means of biotechnology processes and for Advanced Therapy Medicinal Products, subject to specific conditions. Most importantly, the medicinal product would have to contain a new active substance and have a mechanism of action distinctly different from that of any authorised medicinal product in the EU;
- creation of a Regulatory Status Repository by the Commission, a database that contains decisions, opinions and scientific recommendations regarding the regulatory status of health innovations;
- prevention of misuse of biotechnology by stipulating that biotechnology products of concern can be made available, introduced or used only if the person has a legitimate need for those products;
- encouragement of the adoption and integration of AI for activity supporting biotechnology.
In addition, the proposal will amend multiple existing regulations, for example, Regulation 536/2014 on clinical trials, Regulation 2024/1938 on standards of quality and safety for substances of human origin, and Regulation 178/2002 on general principles and requirements of food law. The amendments aim to expedite regulatory processes and reduce regulatory burdens.
Key amendments include:
- establishing a minimal-intervention clinical trial for which the assessment of the reporting member state is limited to an ethical review;
- establishing a single authorisation process for combined studies involving a medicine and a medical device, or an in vitro diagnostic;
- the possibility of establishing several regulatory sandboxes on various matters, such as novel health biotechnology products, food, innovative approaches in clinical trials, and veterinary medicinal products;
- cutting the authorisation period for multinational clinical trials from 106 days to 75 days, with a further reduction to 47 days where no additional information is required;
- eliminating the additional 50 days for assessment of clinical trials involving advanced therapy medicinal products, including speeding up access to advanced investigational therapy medicinal products consisting of or containing GMOs that are complex innovative products.
In 2022, the biotechnology sector accounted for EUR 38.1 billion of the EU’s GDP. Removing fragmented governance and strengthening coordination across member states will lay the groundwork for the growth of the biotechnology sector.
Paving the pathway for simplification: proposal for a regulation to simplify rules on medical and in vitro diagnostic
On 16 December 2025, the European Commission published another long-awaited proposal, namely the proposal to amend Regulation 2017/745 on medical devices, and Regulation 2017/746 on in vitro diagnostic medical devices. The proposal aims to simplify the existing rules, while not compromising safety. The proposal’s key amendments are as follows:
- the validity period for certificates of conformity (currently five years) will be removed. Instead, periodic reviews will take place;
- the definition of clinical data will be broadened. Relying on clinical data of an equivalent device will become more flexible;
- regarding the evaluation of medical devices, the use of new approach methodologies, such as in silico testing, will be promoted;
- the definition of a well-established technology device will be established, and more proportionate requirements will be applicable for these devices;
- classification rules will be adapted, which means that certain devices, such as software, will have lower risk classes;
- the manufacture and use of in-house devices will be made more flexible;
- the definition of breakthrough devices and orphan devices will be established, and these devices will be subject to priority and rolling review;
- single-use claims will have to be justified;
- subject to conditions, orphan devices may continue to be placed on the market after the transition periods;
- the requirements for the person responsible for regulatory compliance will be amended;
- in Annex I of the AI Act, the MDR and IVDR will be moved from Section A to Section B. This is intended to prevent overlaps between regulations and to simplify the regulatory framework for artificial intelligence-enabled devices.
A need to simplify the current regulations has been previously expressed by the European Parliament, several member states, and numerous stakeholders. These simplifications will strengthen the medical device market and the EU’s ability to prevent and respond to public health threats, such as shortages and safety concerns.
Progress regarding Urban Wastewater Directive 2024/3019
The Urban Wastewater Directive regulates the collection, treatment and discharge of urban wastewater, with the goal of protecting the environment and human health. Among other requirements, member states will have to start applying extended producer responsibility to pharmaceuticals and cosmetics. The deadline to nationally transpose extended producer responsibility is 31 July 2027.
Poland, together with several companies, has submitted an application to the European Court of Justice, requesting the annulment of extended producer responsibility. Despite these pending legal challenges, member states are moving forward with the transposition of the directive.
Estonia
Estonia has not adopted the directive. On 2 May 2025, a stakeholder engagement event was held at the Ministry of Climate to introduce the new requirements and discuss potential issues related to their adoption, prior to the drafting of the relevant laws and regulations. Despite the engagement event taking place in mid-2025, neither a draft law nor a development plan for the law has been made public.
Latvia
In 2025, the Latvian Parliament adopted amendments to the Law on Water Management Services, authorising the Cabinet of Ministers to develop the directive implementation plan. The Ministry responsible for implementing this directive will be the Ministry of Climate Energy.
Lithuania
Lithuania has not adopted the directive, nor are there any publicly available materials regarding the transposition.
Key legal developments in the Baltics: from regulatory sandboxes to medical devices and healthcare reimbursement
Estonia
In Estonia, a draft law has been submitted for coordination creating a national experimental framework based on the regulatory sandbox concept. The draft law enables undertakings to make temporarily available on the market innovative products, services or technologies on a test basis, even if:
- the marketing of the product or services is restricted by applicable legislation
- the undertaking does not fully meet the requirements for economic activity
The extent of deviation from certain applicable requirements would be clearly defined. Additionally, the undertaking would be subject to supervision from the competent administrative authority and would have to conclude an administrative agreement. In addition to the national experimental framework, temporary testing requires a sector-specific law. The goal is to establish an experimental framework in at least one sector-specific law in 2026 to enable the testing of new technologies and analyse the framework’s effectiveness.
Latvia
Latvia has adopted amendments to the national Medical Device Regulations to ensure a fairer cost-sharing approach for maintaining the medical device vigilance system. The changes align with the EU Regulation (EU) 2017/745 on medical devices and incorporate requirements from the Artificial Intelligence Act (Regulation (EU) 2024/1689) for AI-enabled devices. These steps will strengthen compliance and enhance monitoring of medical devices in line with EU standards.
Lithuania
On 7 January 2026, the Supreme Administrative Court of Lithuania (SACL) ruled that the Minister of Health’s orders of 9 May 2025 had been adopted in violation of higher-level legal requirements regarding the process for their adoption. These orders amended the procedures for reimbursing personal healthcare services (Order No. V-444) and costly tests and procedures (Order No. V-434), and invalidated the procedure for reimbursing medical rehabilitation, anti-relapse sanatorium treatment, and psychosocial rehabilitation services (Order No. V-438).
The court based its decision on two grounds:
- the Ministry of Health did not conduct an impact assessment before amending the regulations.
- the ministry failed to follow the required timeframe for public consultation on draft acts.
To allow time for corrective measures and new decisions, the SACL postponed the official publication of its ruling until 1 July 2026, when it will appear in the Register of Legal Acts.
On 8 January 2026, the National Health Insurance Fund (NHIF) announced that, until the ruling takes effect on 1 July 2026, healthcare services will continue to be reimbursed under the current rules. The NHIF also stated that, in line with the court’s decision, an impact assessment will be conducted, and new draft orders will be prepared, coordinated with relevant institutions, and adopted before the ruling comes into force.
More information about the case can be found here. The announcement of the NHIF can be found here.
#sorainenlifesciences: our practice in action
- Our partner Lise-Lotte Lääne will be on the organising committee of the EUROBIOTECH Conference taking place this summer in Krakow, Poland (10th Central European Congress of Life Sciences EUROBIOTECH 2026 – eurobiotech.krakow.pl). Lise-Lotte will be organising two sessions with esteemed speakers: “Global IP strategies: navigating diverse laws and cross-border enforcement in biotechnology” and “The key legal challenges and strategies in the journey from the research lab to the commercial market”.
- In November 2025, Sorainen organised a webinar in Latvia, covering topics such as telemedicine, the introduction of artificial intelligence tools in medical and healthcare institutions, and challenges related to personal data processing in e-health systems. Webinar materials are available here (in Latvian).
- In Latvia, we successfully provided pro bono assistance in a case concerning the Medical Treatment Risk Fund compensation system. The case is currently before the Constitutional Court, due to a challenge regarding whether the statutory time limits for claiming compensation under the Patients’ Rights Law comply with the constitutional right to fair compensation.
Our international Life Sciences & Healthcare team is at your disposal, should you need advice on any legal issues you are facing.
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Contact our experts:
Regional head of Life Sciences & Healthcare sector group, Estonia
Senior Associate, head of Life Sciences & Healthcare sector group in Latvia
Senior Associate, head of Life Sciences & Healthcare sector group in Lithuania
