EU Competitiveness: Mind the gap between rhetoric and reality
15.03.23
From last month’s conclusions of the Special meeting of the European Council to the recent meeting of the Competitiveness Council, from the European Semester 2023 to President von der Leyen’s commitment to a standard competitiveness-check in our regulation[1], European competitiveness is top of the agenda.
And yet, despite Member State leaders calling for the EU to act decisively to ensure its long-term competitiveness, prosperity and role on the global stage[2], proposals contained in the leaked draft of the EU pharmaceutical legislation will do irreversible, long-term damage to the competitiveness of an industry that contributes more to the EU trade surplus than any other sector.
On EU competitiveness, there is a significant gap between the rhetoric and the reality.
Perhaps most concerning, is that no attempt has been made to assess and quantify the impact that the loss of competitiveness will have on access to the latest treatments, jobs, R&D investment, academia, manufacturing and growth across Europe. It seems like a very long way from President von der Leyen’s assertion that all our actions have to take the competitiveness of our SMEs and our industry into account[3].
The question remains; how can we move forward with a pivotal piece of legislation that will shape our health, science, jobs and growth for the next 20-30 years, without a full assessment of the impact on European competitiveness?
We do know that the impact of the proposals in their current form will be to widen the gap between Europe, the US and China in the global race to attract life science investment, deliver new treatments to patients first and generate jobs and growth. Despite increasing global investment by research-based pharmaceutical companies, Europe’s R&D investment has dropped by 25% over the last 20 years.
Our academic base is strong, Europe publishes more academic papers on advanced therapies (ATMPS) like gene and cell editing than its rivals. However, the bloc’s policy and financial landscape means there are twice as few ATMP clinical trials in Europe than there are in the US and three times fewer than in China.
For European patients that difference means a lack of opportunity to participate in new clinical trials and benefit from the latest advances in care. Just 25 years ago, 50% of all new treatments emanated from Europe, now that figure is just 1 in 5.
In recent months, we have seen statements from the CEOs of some of Europe’s leading companies, pointing to the difficulties of innovating in Europe and their intent to focus research and development in the US and Asia. These are not knee-jerk reactions. They reflect growing concern that the Commission’s legislative proposals will severely harm to the competitiveness of Europe’s industry.
There is a way forward that can put European patients at the cutting-edge of treatment, create high-value jobs, drive growth and make Europe more resilient. We must use this once in a generation opportunity to future-proof an innovation-minded regulatory framework, and deliver a world-class, robust and predictable intellectual property ecosystem, while at the same time, addressing access issues in partnership with patients, industry and the Member States.
Now is the time to decide what kind of Europe we want to live in – a global hub for the research, development and manufacture of the latest vaccines and treatments or a consumer, reliant on medical innovations from other regions.
[1] https://ec.europa.eu/commission/presscorner/detail/en/speech_22_6262
[2] Special meeting of the European Council (9 February 2023) – Conclusions, II Economy, 13, p5
[3] https://ec.europa.eu/commission/presscorner/detail/en/speech_22_6262
