Rebuilding Europe’s leadership in biomedical innovation

About thirty years ago Europe had a leading, vibrant healthcare sector,<sup>1</sup> but for the past several years, the region has been falling behind the US and a strongly growing and committed China. This erosion of leadership applies to innovation, investment, and equal access to innovative healthcare for patients in the region.

But it’s our conviction at Roche that Europe has the potential to reverse this trend and pioneer the next era of healthcare, and become again a global powerhouse. With the COVID pandemic still dominating the headlines and constraining our lives, now, more than ever, is the time for a bold and ambitious EU Pharmaceutical Strategy. Indeed a healthcare strategy. We must not miss this opportunity.

The biopharmaceutical industry matters to Europe and the health and well-being of its people. The industry is a net exporter, offers high-quality jobs, and is a large contributor to economic growth and local prosperity. Our leading biopharmaceutical companies and institutions anchor innovation and start-up ecosystems. The industry leads all sectors in R&D investment as a proportion of sales, at Euros 36.3 billion in 2019.2 It will play a big role in the post-COVID public health resilience and economic recovery.

And yet, as of today, investment into late phase commercialisation opportunities are often balked at in Europe and the risk is carried, and the benefits accrue, elsewhere. At the same time, early phase investment in innovative therapy US companies is almost six times that of those into European opportunities.3

Losing edge and shrinking to the challenge

In terms of investing into healthcare innovation, competition is increasing. The US leads, China is catching up, and Europe seems less assertive and strategic overall. But that need not be the case. The region has advanced health systems and what it takes to be a leader. It is also home to 16 of the world’s top 50 life science universities.4 The European pharmaceutical industry employs 793,0005 highly-qualified professionals directly, and supports 2.5 million jobs indirectly. With a population of 450 million, the European Union comprises the world’s largest highly-developed trading block.6

Europe also combines areas of entrepreneurial capability with strong values and a steady, thoughtful decision-making culture. And through COVID, we have seen that many countries look to the EU for guidance and leadership in global health. But for the speed and velocities driven by the digital revolution, these traditional strengths are not enough. The attitude towards healthcare in Europe is to see it as a cost and a burden. The demographics of aging populations in Europe - a blessing of increasing wealth and medical progress - create worries around system sustainability. A much more intentional and accelerated policy agenda is needed to drive and yield what’s truly possible now, already today, in the European healthcare arena, in serving patient populations across the board.

A vision for rebuilding pre-eminence

Data is currently driving the revolution in personalised healthcare. The availability of broader, deeper insights into disease biology and better defined patient populations is facilitating earlier, more accurate diagnosis, and more personalised care plans. Smart linking of electronic health records, genomic and other forms of data can better support clinical decision making and drive health system efficiency. When Europe commits to investing in a data-enabled European Health Union it stands a fighting chance of reclaiming its health innovation leadership. Such a European Health Union can overcome fragmentation and friction issues across internal borders, and most importantly, deliver better outcomes to patients and better value to health systems.

Complex problems but the pieces are in place

What’s been missing until very recently is the coordinated resolve and robust political will to make it happen. But in 2020, the COVID crisis has shown us what’s possible when stakeholders coordinate: fast adoption of telemedicine, remote monitoring for specific conditions, and nations sharing clinical approaches in the face of a common enemy. This emergency serves as a model of what healthcare cooperation could look like. “We're in this together” says Chairman Christoph Franz, “Roche, as one of the few companies at the forefront of the response, has entered into several collaborations to fight the COVID-19 pandemic. And we’re working closely with governments, healthcare authorities and the public health communities to ensure the availability of our medicines and diagnostics.”

What else will it take?

Beyond a collective political will, we see five building blocks that could help build health innovation advantages for the citizens of Europe and reverse the course of Europe’s healthcare sector competitiveness:

1. Partnership across the system

Public and private sector actors must work together to take partnership to a new level. At Roche we are making fundamental changes to the way we operate, how we work with our stakeholders, and how we leverage developments in science and technology. Our aim is to deliver what matters most: more patient benefit at far less cost to society. We think the EU could set an equally assertive vision for the EU’s Health Union, and to partner with all stakeholders to make this a reality for the benefit of patients, wherever in Europe they may live. Let’s build a OneEU Innovation engine.

We need to move away from siloed thinking to optimise patient outcomes. We need to join the dots across our systems within nations and across borders to allow for integrated solutions and personalised healthcare. The patient’s experience is highly personal, and we need to avoid friction and transition issues at system handovers, as well as the waste of repeat tests and redo steps in the care process, which can have detrimental effects on patients at the local level. A harmonised approach across the EU can also reduce coordination waste across regulatory and access dimensions. Scientific innovation should not stop at the border.

2. Health data leverage

Roche supports the EU intent to develop an European Health Data Space. Today, the heterogeneity of Europe and local delivery of healthcare cut across productive health data aggregation and analysis. To capture this opportunity, we need to overcome national data silos and fragmentation and collaborate on a bigger canvas, building a learning loop that serves all healthcare stakeholders, whether patients seeking care locally, providers optimising clinical practice, or companies developing new drugs. Scaled, accessible and interoperable health data, with clear governance, holds tremendous promise for each of private and public research in healthcare, and will be critical to the sector’s competitiveness going forward.

“The tremendous connectivity we’ve seen the last few months, enabled by our digital technologies, is only the beginning”, says CFO Alan Hippe. “Digitalisation will continuously reinvent healthcare systems for better access, testing, decision support and individualised treatments”.

The related use and pooling of real world data deriving from electronic data records has the potential to dramatically improve drug development, accelerate patient access, inform clinical practice, and clarify the value of new therapies. It could save time and cost for patients and systems. There has been discussion in Europe on ehealth records for around 15 years. It must now be time to make that happen.

3. Openness to the opportunity and regulation at the leading edge of innovation

It needs a high ambition, risk-readiness, and an openness to innovation. Looking ahead, we see highly sophisticated novel products in the pipeline - medicines, gene therapies, and digital tools. Regulation needs to keep as close as possible to the dynamics of innovation. The current innovation-regulation gap needs to narrow for Europeans to benefit from next- generation therapies and healthcare interventions. The expansion of scope for EMA, as outlined by the European Commission, is welcome. Rapid biomedical progress over the next years needs for the right expertise to be anticipated and in place at regulatory authorities, if patients are to benefit in a timely way from the next wave of advances in healthcare.

4. Dynamic, competitive pace

In 2020, the EU Commission is expected to adopt its EU Pharma Strategy, and EU President’s Ursula von der Leyen’s first State of the Union address attended to health as a priority for the first time ever. In a pandemic crisis, we have seen that when we have material gaps in health systems, all bets are off. The economy, the community, and social life. The address made strong declarations and exciting commitments around future-proofing healthcare.

A Health Union and OneEurope mindset can bring all of Europe onto the same page. While there’s a lot to like about this ambition – which also extends to a European Biomedical Advanced Research & Development Agency (BARDA) and expanded scope and empowerment for the European Medicines Agency and European Centre for Disease Control – it will take a dynamic, competitive pace to be realised.

5. Earlier is better for patient outcomes

Highly innovative health solutions must be accessible to the people who need them. Many European nations have a life science strategy and want to attract inward investment into the high added value biopharmaceutical industry. But at the same time limit the access of their populations to the medicines produced by that very industry. “Even the most ground-breaking innovation is useless if it never reaches the patients,” says our Chairman Christoph Franz. “Our aim at Roche is for every person who needs our diagnostics and medicines to be able to access them, no matter where they live.”

Approximately 70% of all clinical decisions are based on diagnostics, but they account for only 2% of healthcare costs. We believe that earlier is better for outcomes. With more tests, for example, cervical cancer and liver cancer from hepatitis C could be reduced or even prevented. But to have an effect five years from now, health systems need to act today. Roche aspires to contribute in a leading way in the industry by making medical breakthroughs more affordable for society, so that patients do not need to choose between health and financial security. This includes enabling system efficiencies through integrated healthcare solutions in a way that is sustainable for each of health systems and future biomedical innovation.

Integration, yes, solutions, yes

Roche is committed to being a constructive partner in reclaiming the competitiveness of the European biopharmaceutical sector. We bring a unique combination of pharmaceutical, diagnostic and digital businesses. Our activities cover several steps in the patient journey back to health and productivity. We are encouraged by the inclusion of health as a primary driver of European industrial and economic policy as elaborated in Ursula von der Leyen’s State of the Union address. When it comes to science and technology, there should be no boundaries in Europe if we want the region to regain its innovation position and authority at an international level. Investment in and integration of innovation across health systems is a big part of the answer. The beneficiaries will be patients across Europe.

Europe’s competitiveness in healthcare: Status indicators
  • Europe is home to 5 /10 top pharma companies by 2019 sales (US 4, APAC 1)7

  • Europe employs 793,0008 in the biopharma industry, US 500,0009

  • R&D investment Europe Euros 36.3 bn, US USD 62.2 bn10

  • In 2019 North America accounted for 48.7% of world pharmaceutical sales compared with 22.9% for Europe11

  • Both the US and EU are losing share of clinical trials to China, while the EU holds also a lower share of early phase trials, at 24%, vs US 34%, China 29%.12

  • Regulatory environment: EMA median approval timeline 423 days (FDA 243 days)13

  • Graph: Number of New Molecular/ Biological Entities 2000-201914

  • Graph: Where global biopharmaceutical R&D is occurring15



  2. EFPIA, The Pharmaceutical Industry in Figures, 2020

  3. BIO Industry Analysis 2019, Life Sciences Venture Capital Investment

  4. ITIF, Ensuring US Biopharmaceutical Competitiveness, July 2020

  5. EFPIA, The Pharmaceutical Industry in Figures, 2020

  6. EFPIA PwC, The economic and societal footprint of the pharmaceutical industry in Europe, June 2019

  7. FiercePharma, Top 20 Pharma Companies by 2019 revenue

  8. EFPIA, Pharma in Figures, 2020

  9. ITIF, Ensuring US Biopharmaceutical Competitiveness, July 2020

  10. EFPIA, Pharma in Figures, 2020

  11. IQVIA (MIDAS), May 2020

  12. CIRS, 2018

  13. Scrip-EFPIA

  14. ITIF, Ensuring US Biopharmaceutical Competitiveness, July 2020

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