The impact of Wastewater Directive on pharmaceuticals and cosmetics

Micropollutant removal prioritized in UWWTD

The UWWTD entered into force on January 1, 2025, and Member States must transpose it into national law by July 31, 2027.

This version replaces the original 1991 directive, which had already undergone several amendments.

The UWWTD stands out for introducing a new treatment phase called “quaternary treatment.” This process aims to reduce toxic micropollutants in urban waste water and sludge.

According to the Council of the European Union’s page on wastewater treatment policy, although water quality in the European Union (“EU”) has improved considerably over the past 30 years, pollution remains excessive. Major pollutants include nitrogen, phosphorus, organic matter, and toxic micropollutants.

According to the same page, 92% of micropollutants in wastewater come from pharmaceuticals (including antibiotics) and cosmetics.

Quaternary treatment must be implemented in urban wastewater treatment plants with loads of at least 150,000 population equivalents (i.e., the average pollution load per person per day) by the following deadlines:

• December 31, 2033: 20% of plants
• December 31, 2039: 60% of plants
• December 31, 2045: All plants

Assigning responsibility to pharmaceutical and cosmetics sectors under “extended producer responsibility” principle

The UWWTD identifies pharmaceuticals and cosmetics as the primary sources of micropollutants in wastewater.

Recital 20 clarifies that, rather than increasing public taxes or tariffs for the general public, the EU assigns most treatment costs to pharmaceutical and cosmetics companies. This aligns with the “extended producer responsibility” principle, based on the “polluter pays” principle, which is already established for solid waste management. This principle holds economic operators accountable for any environmental damage they cause, including prevention and mitigation measures, and the duty to bear any associated costs.

Accordingly, producers of pharmaceuticals and cosmetics that place their products on the EU market must bear:

• at least 80% of the costs to build, expand and operate quaternary treatment plants to remove micropollutants from urban wastewater;
• costs for monitoring micropollutants in urban wastewater, including collecting and verifying data on the products they place on the market; and
• other costs linked to fulfilling their extended producer responsibility obligations, such as financial contributions to producer responsibility organizations of which they will be members.

However, producers may qualify for exemptions if either of the following conditions is met:

• The total annual amount of substances contained in the products they place on the EU market is less than one metric ton.
• The substances contained in the products they place on the EU market are either readily biodegradable or produce no micropollutants in wastewater.

Legal challenges to extended producer responsibility system

Under the UWWTD , companies covered by extended producer responsibility must comply with their obligations by December 31, 2028.

However, several legal challenges have been filed against the directive’s extended producer responsibility system.

For example, on March 10, 2025, Poland brought an action before the Court of Justice of the European Union to annul the rules on extended producer responsibility (Case C-193/25). Specifically, it claims that the directive breaches:

• the “polluter pays” principle and the principle of equal treatment, as it targets only pharmaceutical and cosmetics producers, while disregarding other product types that also produce these substances; and
• the principle of proportionality, arguing that the imposed costs are excessive for their intended purpose.

In addition to the action brought by Poland, others have been brought to the General Court of the European Union by the European Federation of Pharmaceutical Industries and Associations (EFPIA) and the Cosmetics Europe Association, as well as a joint action by 10 other companies to the Court of Justice.

These actions also argue that the directive may breach the “polluter pays” principle and impose disproportionate costs, which could hinder public access to medicines.

Outlook and practical guidance for affected companies

Ongoing litigation concerning the UWWTD introduces uncertainty as regards the implementation of an extended producer responsibility system that places this burden on the pharmaceutical and cosmetics sectors.

However, affected companies should take the following proactive steps:

• Monitor transposition into national law

As explained, Member States must transpose the UWWTD by July 31, 2027. Also, implementation may vary among countries, so affected companies should pay close attention to new national rules and monitor regulatory risks in each market. For example, in Portugal, observing the guidance from pertinent regulatory authorities such as Infarmed, APA and ERSAR will be critical.

• Map and monitor substances

1. Conduct a thorough assessment of substances in marketed products, focusing on those that may generate micropollutants in wastewater.
2. Establish continuous monitoring systems to comply with legal obligations and collect the data required under the directive.
3. Estimate associated financial costs.

• Evaluate biodegradability and potential exemptions

To qualify for exemptions under the UWWTD, companies should explore alternative substances that are either biodegradable or do not generate micropollutants.

• Participate in producer responsibility organizations

The implementation of the UWWTD will require pharmaceutical and cosmetics producers to set up organizations to manage their assigned responsibilities, comparable to existing practices in solid waste management.