Is Europe attractive for Life Science Investments?

By Barbara Freischem, Executive Director

Last week, I had the privilege of speaking at a roundtable discussion, organised by Johnson&Johnson and EurActiv as part of the European Biotech Week, to address the important question: is Europe attractive for live science investments?

Europe certainly has great science and academia; we’re well-regulated and adapting to new challenges; and we have flourishing bioclusters and innovative SMEs. We thrive on our diversity, which can provide for many different needs.

But other countries and regions aren’t sleeping. The United States have the advantages of one language, cohesive federal support, a long history of backing small businesses, and a culture that rewards risk and success, but allows for failure. In Japan, with the Sakigake strategy, there are regulatory incentives for regenerative medicines and there are strong investments in medicines for an aging society. China has the highest number of gene therapy clinical trials and four dozen innovative new drugs are slated to be reviewed under China’s fast-track system, including more than 20 products for rare diseases. It has overtaken the U.S. to become the largest market for cell therapy development.

For the EU to remain competitive we need to ensure that there is strategic support at the EU and national levels and that these policies are aligned. Importantly, we also need to ensure that these policies are not undermined by reducing IP protection. It makes no sense to provide public funding for research, discovery and kick-starting innovative businesses, only to limit the opportunities for SMEs by restricting IP protection[1]. Not only does this limit the revenues companies can gain on their inventions, but more importantly, it reduces their chances of finding private (non-governmental) funding, as funders only have IP as a security for their investments.

So, it’s important to note that when the EMA analysed the origin of new medicines, they found that 30% of all new medicines authorized during the time-period studied originate from SMEs and 60% of new medicines for orphan indications originate from SMEs[2]. Many of these medicines would not be possible without incentives and support. Sponsors of orphan medicines significantly benefit from fee waivers for regulatory procedures, and a 10-year market exclusivity, for instance. The sponsors of products with orphan drug designation currently receive incentives such as protocol assistance, which facilitates the development and authorisation of innovative medicines for the benefit of patients. Without these incentives, it will be much more difficult for biopharmaceutical SMEs to thrive.

At EBE, we are committed to working with the European funding environment (including Horizon2020, European Research Council, European Investment Bank, etc.) to ensure SMEs have the support they need. As part of that effort in March 2017, we supported the launch of a report by the European Investment Bank (EIB) which exposed significant funding gaps. In an EBE report in December last year (print only), which looked at the development of the global environment for Advanced Therapies and what they mean for Europe, we made a number of recommendations that actually apply to novel therapies in general. For example, that there should be a renewed effort by public bodies like the European Investment Fund and others to work with private sector funds to provide the long-term capital that European biotechs need to get products to market. To maintain momentum, Europe needs to create the conditions for widespread commercialization to ensure its health care systems are ready to adopt these novel technologies.

So, is Europe attractive for Life Science Investments? The answer is an enthusiastic yes, but we can’t rest – much needs to be done to ensure that the EU remains competitive and that biopharmaceutical SMEs continue to thrive.

[1] https://www.ebe-biopharma.eu/wp-content/uploads/2018/08/EBE-SPC-waiver-position-2018-08-02-final.pdf

[2] http://www.nature.com/nrd/journal/ v13/n2/full/nrd4232.html

2018-10-05T10:06:11+00:00October 5, 2018|