Pharmaceutical companies may soon have to pay a larger share of the cost of removing medicine residues from wastewater across Europe. The EU has put this responsibility into law, but manufacturers still have questions about how much they will pay & how regulators will calculate their share.

The new pharmaceutical wastewater rules are already creating concern, particularly among generic medicine manufacturers. These businesses often work with tight margins, high production volumes & strong price competition. An extra cost that looks small on paper can become significant when a company sells millions of packs each year.

There is also a legal challenge to consider. Pol& has asked the EU’s top court to annul part of the new system, & an Advocate General has recommended that the Court do so. The Court has not yet delivered its final judgment. For manufacturers, that leaves an important question: how should they prepare for a system that is part of EU law but still faces a legal challenge?

What will pharmaceutical companies have to pay for?

Removing medicine residues from wastewater takes more than the usual treatment process. Some wastewater treatment plants need an extra stage to remove micropollutants that standard treatment may leave behind. This is known as quaternary treatment. It can involve methods such as activated carbon or ozonation.

Under the revised Urban Wastewater Treatment Directive (EU) 2024/3019, pharmaceutical & cosmetics producers must help pay for this additional treatment. The directive came into force on 1 January 2025, & EU member states have until 31 December 2028 to set up their producer responsibility schemes.

The rules require producers to cover at least 80% of certain costs. These include the extra treatment itself, monitoring, & the collection & verification of product information. Water utilities & public authorities will therefore not have to carry the entire bill for this work.

But how much will an individual company pay? That depends on the products it sells, the quantities it places on the market & the substances those products contain. The rules also take account of the hazardousness of those substances.

This is where pharmaceutical companies need to look closely at their own product ranges. A manufacturer selling a small number of high-volume medicines may face a different level of exposure from one with a larger, more varied portfolio. Sales across several EU countries can add another layer of work, as each country will need to implement the scheme through its own national arrangements.

Some products may qualify for exemptions under specific conditions. These include certain limits on the quantity of a substance placed on the market, as well as conditions linked to biodegradability & the formation of micropollutants. Companies will need evidence to support any exemption they claim. They should not assume that a product qualifies simply because it is sold in small quantities or has a well-established safety record.

Why is the EU’s approach being challenged?

Not everyone agrees with the way the EU has decided to distribute these costs. Pol& has taken the issue to the Court of Justice of the European Union in Case C-193/25, challenging Article 9(1) alongside Annex III of the directive.

The concern is about the legal basis & reasoning behind the cost-sharing system. In particular, the case raises questions about the evidence used to decide which producers should pay & how the rules justify that decision.

On 3 September 2026, Advocate General Juliane Kokott recommended that the Court annul Article 9(1)(a) & Annex III. Her opinion questions aspects of the reasoning behind the system. It is an important development, but it is not the final decision. The judges still need to issue their ruling.

So, where does that leave manufacturers? For now, the requirements remain part of the directive. Companies should not assume that the scheme has been cancelled just because the Advocate General has recommended annulment.

The final judgment could change the way pharmaceutical pollution in Europe is funded. It could also affect how the EU & member states justify the costs assigned to producers. Until the Court rules, however, businesses have to plan around the rules currently in force while keeping an eye on the case.

That uncertainty makes early preparation useful. A company does not need to know its final contribution today to start identifying the products, sales figures & environmental data that could affect its bill.

Could the extra cost affect generic medicines?

Generic medicine manufacturers have a particular reason to pay attention. Once a medicine loses patent protection, several companies may start selling versions of the same product. Buyers can compare prices & move to another supplier, which puts pressure on manufacturers to keep their costs under control.

That leaves less room to absorb new expenses. Pharmaceutical manufacturing costs already cover ingredients, testing, packaging, energy, transport & regulatory work. A new environmental contribution would add to those costs, even if the amount charged for each pack appears modest.

Take a company that sells millions of packs of a common generic medicine across Europe. A small charge per pack could turn into a sizeable annual expense. If the company sells many products at similar volumes, the combined cost could put further pressure on its margins.

The cost will affect companies in different ways under the pharmaceutical wastewater rules. A manufacturer that sells many types of medicines may be able to spread the expense across its product range. A smaller company that depends on a few low-priced medicines may find it harder to manage.

Passing the cost on to buyers is another option, but it may not work for everyone. Generic medicine prices are often tight because several suppliers compete for the same contracts. If one company raises its prices, buyers may simply choose another supplier. Some manufacturers may have to absorb the extra cost. Others may reconsider whether certain products are still worth supplying under the pharmaceutical wastewater rules.

This is a concern for lower-priced medicines. If the cost of supplying a medicine rises while its selling price stays the same, the profit margin gets smaller. In some cases, a manufacturer may decide to stop supplying that product in a particular market. That is a possible risk, not a guaranteed outcome. Much will depend on the final charges & how much room each company has to manage them under the pharmaceutical wastewater rules.

For the EU, the challenge is to cover the cost of removing pharmaceutical pollution without putting unnecessary pressure on medicine supplies. How regulators apply the pharmaceutical wastewater rules in practice will matter just as much as the amount companies have to pay.

What can manufacturers do before 2028?

Companies can start preparing for the pharmaceutical wastewater rules now. They already hold much of the information they need, including product lists, sales figures & regulatory records.

Start by checking which medicines the company sells across the EU & how many packs it supplies in each country. This will help finance teams estimate the possible cost. It will also show which products could face the greatest pressure if the charges under the pharmaceutical wastewater rules are high.

Next, review the ingredients in those medicines & the available data on their environmental impact. Check whether the substances are hazardous, how quickly they break down, & whether they can form micropollutants. This information may also help companies work out whether any products qualify for an exemption under the pharmaceutical wastewater rules.

A few other checks can make the process easier:

• Check sales country by country. Total European sales figures will not show the full picture. Keep separate figures for each market so the company can respond to national reporting requirements under the pharmaceutical wastewater rules.
• Work out the possible cost. Finance teams can estimate how different charges might affect high-volume generics & medicines with low profit margins. The final figures may change, but these estimates can help identify the products that need attention first.
• Decide who will handle the data. Product, regulatory, finance, & sustainability teams may all hold information needed for the scheme. Agree on who will collect it, check it, & submit it.
• Review existing contracts. Check whether agreements with distributors & other partners explain who will handle reporting & pay the new charges. If the contracts do not cover these points, the company may need to address them.
• Keep track of national rules. Each EU country will set up its own scheme. Companies that sell medicines in several countries should follow each country’s plans rather than assume the same process will apply everywhere.

These steps will also help companies spot gaps in their pharmaceutical environmental compliance. Missing product information & unclear responsibilities are easier to deal with before reporting deadlines approach.

Factory wastewater is a separate matter

The pharmaceutical wastewater rules do not replace every wastewater obligation that applies to a pharmaceutical company. Manufacturers must still meet the rules that apply to wastewater from their own factories.

A manufacturing site may need to meet specific discharge limits, operate treatment equipment, monitor wastewater quality & keep records under its environmental permits. The exact requirements depend on the site, the substances involved, & the laws that apply in that country.

The EU’s producer scheme deals with the additional cost of treating wastewater at qualifying urban treatment plants. Factory-level wastewater management is a separate responsibility.

That distinction matters when companies plan their environmental budgets. A manufacturer could have to contribute to a national scheme & still need to invest in its own treatment systems. Paying into the producer scheme does not allow a factory to discharge wastewater that fails to meet its permit conditions.

The reverse is also true. A company that has already invested in pharmaceutical wastewater treatment at its own site should not assume that this automatically removes its obligations under the pharmaceutical wastewater rules. The two address different parts of the problem.

Manufacturers should check both areas when reviewing their environmental costs. This will give them a more accurate picture of what they may need to spend.

Other EU water rules are changing too

The revised wastewater directive is not the only change manufacturers need to follow. New EU rules on pollutants in surface water & groundwater entered into force on 11 May 2026. Member states must bring their national laws into line with these rules by 22 December 2027.

For pharmaceutical companies, these changes mean that environmental data will remain an important part of compliance. Teams need to know what information they hold about their products, ingredients, & factory discharges, including data that may be relevant to the pharmaceutical wastewater rules.

Finding that information can take time. Product teams may hold ingredient details, regulatory teams may manage product records, & environmental teams may monitor factory wastewater. If each team keeps its own records, the company may struggle to get a complete picture when it needs one.

A simple review can help. Check what data the company collects, where it keeps the records, & whether the information is up to date. Then identify any gaps & decide who needs to fill them.

Companies selling medicines in several EU countries should also keep an eye on national updates. The EU sets the overall direction, but businesses still need to understand how the pharmaceutical wastewater rules apply to their products in each market.

What happens next?

The Court of Justice still needs to decide Pol&’s challenge. At the same time, EU countries must continue preparing their producer responsibility schemes. Manufacturers should follow both developments because the final ruling & national rules will shape how the system works in practice.

Companies can use this time to review their sales data, check the environmental information they hold, & work out which products could face the greatest cost pressure. They should also keep factory discharge obligations separate from contributions under the producer scheme. That will make budgeting & planning more accurate.

The main concern is how to pay for cleaner water without adding unnecessary pressure to medicine supplies. The pharmaceutical wastewater rules will affect companies differently, especially those that sell low-priced medicines with little room for extra expenses. Manufacturers that understand their costs early will be better prepared as the legal & national requirements become clearer.

The 5th Net-Zero Life Sciences Forum 2026 takes place in Düsseldorf on 12–13 November 2026. The event will bring life sciences professionals together to discuss sustainability, regulation & the changes affecting the industry. It will also allow companies to share how they are approaching environmental costs while keeping production & medicine supplies on track.