The “Condition” is typically a recognised distinct disease or syndrome that is the subject of a paediatric investigation plan (PIP) and/or waiver application required for most new, and some authorised, medicinal products in the EU. Its scope defines the disease(s) that must be covered by, or that may be excluded from, paediatric development for the medicinal product. The PIP Condition may be broader than the proposed indication that is the subject of a marketing authorisation. This is important in stimulating adequate investigation of the product in diseases with unmet paediatric needs, although the extent of the studies and other measures required by a PIP may have important financial implications for the pharmaceutical company. Therefore, defining the PIP Condition in a systematic way is important, and this is facilitated by a policy introduced by the European Medicines Agency (EMA) in 2012. This determines the PIP Condition by starting from the proposed indication, and then taking account of the MedDRA hierarchical coding of diseases relating to the indication, the plausibility of efficacy of the product in paediatric diseases, and unmet paediatric therapeutic needs. Treatment, prevention and diagnosis of the same disease would all be considered separately. Hypothetical examples of how to apply this policy in optimally determining the PIP Condition are discussed.