On 5 December 2024, the French Government was forced to resign following the vote of non-confidence by the French National Assembly towards the Social Security Financing Bill (“PLFSS“). A new Government was then appointed on 23 December 2024. As a result, 2024 ended without a PLFSS for 2025, leaving the Pharma and MedTech industries in uncertainty, particularly regarding the safeguard clause mechanism.
A Special Law To Prevent From Any Shutdown
The PLFSS is debated annually by the French Parliament to organise and anticipate the Social Security spending based on the State’s revenue forecast. This bill is crucial as it notably sets the borrowing capacity of Social Security organisations in France.
Without the adoption of the PLFSS for 2025, France might face a shutdown situation. To avoid such a situation, on 20 December 2024 the former Government proposed a “special law” to the National Assembly. This special law authorises the French Government and the French Social Security to borrow a certain amount to secure the financing of the Social Security.
However, such special law does not contain any other provisions regarding the financing of the Social Security, leaving aside, for the time being, the special measures previously debated in Parliament for the adoption of the PLFSS. Whilst a Social Security Financing Law for 2025 must in any case be voted and adopted by the French Parliament, we cannot predict whether the new Government will build its new PLFSS from the last provisions adopted before the vote of non-confidence or if it will start from scratch.
The Pharma and MedTech industries are thus forced to wait for the new Government to propose its new PLFSS with the risk that some guarantees previously obtained – in particular by the French pharma trade union association, the “LEEM” – may not be included. This may be the case for the safeguard clause. For a detailed insight into the safeguard clause and the state of the current negotiations please see here.
