Pharmaceutical APIs in CETA: what changes for EU-Canada manufacturers

Key data

Manufacturers of active pharmaceutical ingredients (APIs) exporting between the European Union and Canada will operate with less regulatory bureaucracy following the entry into force of the Council Decision (EU) 2026/1070, published on 12 May 2026. The measure amends the Protocol on mutual recognition of good manufacturing practices (GMP) of CETA, incorporating APIs into the list of Annex 1, point 2 of that protocol.

Until now, APIs were not included in that list, which forced manufacturers to manage parallel inspections in both jurisdictions. With this amendment, an inspection conducted by a European authority —such as the Spanish Agency for Medicines and Health Products (AEMPS) in the case of Spain— will be recognized as valid by Canadian authorities, and vice versa.

What does this regulation establish?

The EU Council has adopted the European position to amend the Protocol on mutual recognition of good manufacturing practices (GMP) included in the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU. The specific change is the incorporation of active pharmaceutical ingredients (APIs) into the list of Annex 1 of that protocol.

The mechanism works as follows: when a regulatory authority from the EU or Canada inspects an API manufacturer and certifies that it complies with good manufacturing practice standards (GMP), the other party recognizes that certification as equivalent to its own. This eliminates the need to conduct a second inspection to access the market of the other territory.

The decision was adopted by the Council on 5 May 2026 and published on 12 May 2026. The exact date of entry into force depends on formalization within the CETA Joint Committee, which is the body responsible for implementing these amendments.

Economic and operational impact

The most direct impact is the reduction of regulatory costs for API manufacturers operating in the EU-Canada corridor. Good manufacturing practice inspections are costly processes in terms of time and resources: they involve document preparation, prior internal audits, availability of technical personnel, and in many cases, inspector travel.

By eliminating the duplication of inspections, affected companies can expect:

• Reduction of direct costs associated with the preparation and management of duplicate regulatory inspections.
• Greater agility in the supply chain: less waiting time to obtain certifications valid in both markets.
• Improved security of supply of critical raw materials for medicines, by facilitating the flow of APIs between the EU and Canada.
• Reduction of barriers to entry for API manufacturers that until now did not export to the other market due to the regulatory cost of dual inspection.

From a strategic perspective, this measure strengthens pharmaceutical regulatory integration within the CETA framework and may have a positive impact on the resilience of the medicine supply chain, an aspect especially sensitive following disruptions in recent years.

Who does it affect?

• Manufacturers of active pharmaceutical ingredients (APIs) established in the EU that export to Canada or that receive inspections from Canadian authorities.
• API manufacturers established in Canada that export to the EU or that are inspected by European authorities.
• EU pharmaceutical companies that depend on APIs imported from Canada for the manufacture of medicines.
• Canadian pharmaceutical companies that use APIs from the EU.
• National regulatory authorities of the EU (such as AEMPS in Spain, BfArM in Germany, or ANSM in France) responsible for GMP inspections.
• Regulatory and quality departments of pharmaceutical groups with operations in both jurisdictions.
• Regulatory advisors and compliance consultants who manage market access for their clients in the EU-Canada corridor.

Practical example

A Spanish API manufacturer with a plant in Catalonia that supplies active ingredients to Canadian laboratories currently must manage two inspection processes: one from AEMPS (Spanish authority) and another from Health Canada (Canadian authority). Each process involves document preparation, internal audits, coordination with inspectors, and waiting times for the issuance of certificates.

With the entry into force of this amendment to the CETA Protocol, the inspection conducted by AEMPS —which certifies compliance with good manufacturing practice standards— will be directly recognized by Health Canada as equivalent. The Spanish manufacturer will be able to access the Canadian market with that certification, without needing to undergo an additional inspection by Canadian authorities.

The practical result: less waiting time to market, lower regulatory cost, and greater ability to respond with agility to Canadian demand for APIs.

What should companies do now?

1. Identify whether they manufacture or import APIs in the EU-Canada corridor. If the answer is yes, this regulation affects them directly and they should monitor its evolution.
2. Monitor the entry into force date. The Decision was published on 12 May 2026, but effective application depends on formalization in the CETA Joint Committee. Consult the official communications of the Decision (EU) 2026/1070 and of the corresponding national regulatory authority.
3. Review current GMP inspection and certification processes. Map which inspections are currently being conducted in parallel and which can be unified once mutual recognition enters into force.
4. Contact the national regulatory authority (in Spain, AEMPS) to confirm the implementation timeline and the specific procedures to benefit from mutual recognition.
5. Evaluate commercial opportunities. The reduction of regulatory barriers may open or expand access to the Canadian market for API manufacturers that until now did not export due to the cost of dual inspection. Review the commercial strategy with this new scenario.