Why is pharmaceutical innovation in Europe important for jobs and growth? – POLITICS

Recent crises have highlighted the crucial need for Europe to secure and strengthen its position as a leader in medical innovation. As the European Commission works on the next pharmaceutical strategy, we need to ensure that Europe has the right environment to bring the next generation of treatments to patients. The challenge for the coming decades is not whether medical innovation will happen, but where it will happen. This article is part of a series explaining that where innovation happens matters to patients, healthcare systems, the research community, jobs and the economy.

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On December 13, 2021, I was out in the cold air, shovel in hand. Growing up on a farm in Jutland, Denmark, it’s a familiar feeling to me. But the circumstances that day were very special. I was innovating in Kalundborg, a port town on the Danish island of Zealand. The company I run, Novo Nordisk, opened a factory there in 1969 with five buildings. Things have since changed, with the site employing over 3,200 people and producing around half of the world’s insulin.[1].

This is the largest total investment we have ever announced. It will help meet the growing demand for our medicines.

Things are about to change even more: when I picked up this shovel in December, I was in the process of launching new installations that will require more than 17 billion Danish crowns of investment (more than 2.2 billion euros). This is the largest total investment we have ever announced. It will help meet the growing demand for our medicines, while cutting-edge production technologies will help reduce their environmental footprint. Clearly, we are ready to invest here in Europe.

Lars Fruergaard Jørgensen, CEO of Novo Nordisk and First Vice-President of EFPIA | by EFPIA

But Kalundborg is not the only place where Novo Nordisk made a major new investment last year. We are establishing a new center for the application of artificial intelligence in drug discovery, at our R&D site in Seattle, USA

We have also invested heavily in recent years, establishing our research and manufacturing capabilities for cell therapies, primarily in California and New Hampshire. The competition for talent there is intense – but nothing replaces the expertise we find in the world’s cutting-edge ecosystems for digital technology and regenerative biology.

Next year, the European Commission will launch the biggest review of pharmaceutical legislation in a generation. You will hear voices talking about Europe’s leading position in pharmaceuticals – and others claiming that Europe is doomed to fall behind the US and China, with their huge investment in science. As things stand, both claims contain elements of truth. We must not be desperate, but we must not be complacent.

EU pharmaceutical exports have more than doubled between 2010 and 2020, more than any other R&D-intensive sector.

The present and the future of a strategic industrial sector in Europe

Pharmaceuticals account for the largest share of the EU’s external trade surplus, reaching €118 billion in 2020[2]. More than 830,000 people are directly employed in the sector in Europe. And the sector continues to grow: EU pharmaceutical exports have more than doubled between 2010 and 2020, more than any other R&D-intensive sector. Employment in our sector in Europe increased by more than 15% over the same period[3]. Our R&D and manufacturing added over €116 billion in gross value in the EU in 2019[4]. This position has developed over decades: our capital investments in R&D and production are made for the long term, and our employees are our greatest resource.

But these long time horizons and global competition for talent mean today’s strong performance could mask a different future. Today, the United States is the center of global pharmaceutical innovation. Drug approval times are consistently shorter here than in the EU[5], which means that patients there benefit from innovation earlier. Pharmaceutical R&D spending by companies is increasing in Europe, but is constantly overtaken by the United States[6] The investment situation in early-stage companies is particularly concerning: if you are an innovator in need of capital, you will be much more likely to go to Boston or California than anywhere in the EU. China’s innovation capabilities are also growing, with biotech being a major focus of the Made in China 2025 strategy. Between 2018 and 2020, seven of the top 10 biopharmaceutical IPOs were launched in China.[7].

A thriving pharmaceutical sector in the EU is therefore essential to support the health resilience of the population.

Meanwhile, European populations are ageing, with an increasing burden of serious chronic diseases. New global health threats will emerge. Obviously, Europe needs what our sector can offer. Fortunately, the convergence of advances in data and biological science means that we have unprecedented potential to meet these challenges – as shown by the remarkable speed of development, regulatory approval and mass production of COVID vaccines – including a significant proportion occurred here. A thriving pharmaceutical sector in the EU is therefore essential to support the health resilience of the population.

Under these circumstances, the EU needs a regulatory framework for medicines fit for the future. With the upcoming revision of the pharmaceutical legislation, we have the chance to succeed. But the regulatory environment is only part of our ecosystem, between research and the market. Resilience starts with research, and great research needs a viable market if it is to benefit people. Antimicrobials are an area where market conditions have led to a catastrophic decline in research. We don’t want to see other diseases follow the same path. In another industrial sector, semiconductors, the European Commission is proposing a “Chips Act” to bring production back to Europe. Let’s make sure we never get to that stage for drugs. I am worried: many European policy makers still see medicines more as a budgetary cost than an investment in their people and economy. But I still have hope that we can make the right political choices – which is why I am now engaging in this discussion and have taken on the role of Vice President of EFPIA, the Innovative Pharmaceutical Association for Europe.

Resilience starts with research, and great research needs a viable market if it is to benefit people.

In 2023, Novo Nordisk will celebrate its centenary. I’m the temporary custodian of this foundation-owned company – and only the fifth in all this time. Our innovation and our daily work benefit patients, job creation and the whole EU economy. Today, Novo Nordisk employs over 22,000 people in the EU. We supply diabetes medicines to more than 34 million patients worldwide and around five million in the EU. I believe these numbers may still increase – but it is not guaranteed. When future generations of pharmaceutical leaders take the shovel, will they innovate in Europe?


[1] Our heritage | Novo Nordisk | Driving change

[2] EUROSTAT data on international trade in goods

[3] The EFPIA industry in figures 2021p.13

[4] Eurostat annual detailed business statistics for services and industries

[5] CIRS, Briefing DR 70New approvals in six regulatory authorities 2009-18

[6] The EFPIA industry in figures 2021p.5

[7] McKinsey, The dawn of biopharmaceutical innovation in China2021

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