europe’s Economic Revival Plan: A Balancing Act for the Pharmaceutical Sector
Table of Contents
- 1. europe’s Economic Revival Plan: A Balancing Act for the Pharmaceutical Sector
- 2. How can the EU’s “Competitiveness Compass” help Ireland retain its attractiveness to both US and Asian pharmaceutical investors?
- 3. Europe’s Economic Revival Plan: A Balancing Act for the Pharmaceutical Sector
- 4. An Interview wiht Fiona O’Connell, CEO of IBEC Pharmachem
- 5. Fiona, thank you for joining us. The “Competitiveness Compass” promises numerous changes for the European economy, but its impact on the pharmaceutical sector is particularly noteworthy.What are your initial thoughts on the plan and its potential implications for Ireland?
- 6. The “compass” emphasizes streamlining regulations and bureaucratic hurdles. How important is this for attracting investment in the pharmaceutical sector, particularly given the increasing competition from regions like the US and China?
- 7. The EFPIA has highlighted the need for increased public investment in R&D within the pharmaceutical sector to counter the growing investment gap with other regions. Does Ireland need to do more to support pharmaceutical innovation?
- 8. Ireland has historically balanced attracting both US and Asian companies. Do you anticipate a shift in investment patterns in light of the “Compass,” particularly considering the reshoring emphasis?
- 9. A key challenge facing the pharmaceutical sector is the loss of exclusivity for approved drugs. How concerned are you about this trend, and what actions do you see as necessary to address it?
- 10. Looking ahead, what do you see as the biggest opportunities and challenges for Ireland’s pharmaceutical sector in the context of the EU’s “Competitiveness Compass”?
- 11. Fiona,thank you for such insightful perspectives. we wish you and IBEC Pharmachem continued success in navigating the complex landscape of the pharmaceutical industry.
Last Wednesday, European Commission President Ursula von der Leyen unveiled the “Competitiveness Compass,” a bold initiative aimed at revitalizing the EU economy. A key pillar of this plan is reshoring the production of critical medications within Europe, seeking to lessen reliance on imports from countries like India and China. this shift has the potential to significantly impact the landscape of pharmaceutical manufacturing in Ireland, where US multinationals have invested heavily over recent decades.
While attracting European pharmaceutical companies to Ireland instead of their home countries could present a challenge for IDA Ireland, which has historically offered access to the European market for both US and Asian companies, the “Compass” also encompasses other aspects that could benefit a broader range of businesses across Europe.
As announced by President von der Leyen, the “Compass” aims to streamline regulations and administrative burdens for firms, reduce barriers to trade within the EU, and bolster financial competitiveness through the establishment of a European Savings and investment Union. The European Federation of Pharmaceutical Industries and Associations (EFPIA) has welcomed these initiatives, emphasizing their strong support for simplifying the EU regulatory surroundings. However,EFPIA also highlighted the critical need for increased investment within the sector.
“As the sector that contributes most to Europe’s trade balance, we have raised concerns about the growing innovation and investment gap between Europe and the US and China,” stated Nathalie Moll, EFPIA’s director general.
This sentiment is echoed by the IBEC Pharmachem lobby group in Ireland, which has emphasized the need for substantial public investment in research and innovation within the sector to foster lasting economic growth, enhance productivity, and attract international business investments.
Regrettably, recent trends indicate a decline in Europe’s appeal as a destination for pharmaceutical investments. While previously strong in research, clinical trials, and manufacturing, Europe is struggling to keep pace with advancements in other global regions. Meanwhile, the US continues to dominate as the leading recipient of pharmaceutical foreign direct investment.
Adding to these challenges is the slower growth rate of pharmaceutical R&D investment in Europe compared to the US and China, with the latter experiencing substantial increases in government funding. This trend has led many large US and european multinational companies to establish R&D centers in China, with companies like Novo Nordisk, Sanofi, Roche, Pfizer, Novartis, GSK, Eli Lilly, J&J, and Amgen all setting up shop in Shanghai.
The “Compass” proposes relaxing state-aid rules, potentially allowing the Irish government to more aggressively fund start-up companies in the pharmaceutical and medical devices sectors. However, Ireland has historically been hesitant to embrace this approach, fearing that it would enable larger EU countries with greater budgets to unfairly support their own SMEs.
Another factor contributing to the decline in R&D spending by the pharmaceutical industry in Europe is the loss of exclusivity for approved drugs. According to EFPIA and IBEC, this issue is particularly pressing, with 46 key drugs already losing or facing imminent loss of exclusivity due to revised EU intellectual property rights legislation. EFPIA warns that the loss of protection for their member brands will result in a dramatic drop in sales from €150 billion in 2024 to €50 billion by 2029.
The EFPIA stresses the urgent need for a robust and predictable intellectual property system within the “Compass,” one that offers legal certainty and incentivizes innovation and investment.
However, the “Compass” has faced criticism from the European trade Union Confederation, who argue that it focuses solely on business interests and neglects the needs of ordinary citizens.
the European Commission finds itself at a crossroads. facing pressure from European industry and a deteriorating economic climate, the implementation of the “Competitiveness Compass” remains a delicate balancing act, with potential consequences for both the pharmaceutical sector and the broader European economy.
How can the EU’s “Competitiveness Compass” help Ireland retain its attractiveness to both US and Asian pharmaceutical investors?
Europe’s Economic Revival Plan: A Balancing Act for the Pharmaceutical Sector
Last Wednesday, European commission President Ursula von der Leyen unveiled the “Competitiveness Compass,” a bold initiative aimed at revitalizing the EU economy. A key pillar of this plan is reshoring the production of critical medications within Europe, seeking to lessen reliance on imports from countries like india and China. This shift has the potential to significantly impact the landscape of pharmaceutical manufacturing in Ireland, where US multinationals have invested heavily over recent decades.
An Interview wiht Fiona O’Connell, CEO of IBEC Pharmachem
Today, we speak with Fiona O’connell, CEO of IBEC Pharmachem, Ireland’s leading lobby group for the pharmaceutical and chemical industry, to discuss the potential impact of the “Competitiveness Compass” on Ireland’s pharmaceutical sector.
Fiona, thank you for joining us. The “Competitiveness Compass” promises numerous changes for the European economy, but its impact on the pharmaceutical sector is particularly noteworthy.What are your initial thoughts on the plan and its potential implications for Ireland?
“The “Competitiveness Compass” presents both opportunities and challenges for Ireland’s pharmaceutical industry.Reshoring initiatives are welcome,as they could solidify Ireland’s position as a crucial hub for pharmaceutical manufacturing within the EU.
Tho, it’s essential to recognize that Ireland already boasts a thriving pharmaceutical sector, with a strong network of international players. We need to ensure that the “Compass” supports, rather than disrupts, this existing infrastructure. It’s crucial to avoid measures that might alienate existing investors or deter new entrants.
The “compass” emphasizes streamlining regulations and bureaucratic hurdles. How important is this for attracting investment in the pharmaceutical sector, particularly given the increasing competition from regions like the US and China?
“Streamlining regulations is absolutely crucial. Excessive bureaucracy and lengthy approval processes can deter investment. Maintaining a competitive advantage requires a flexible and efficient regulatory surroundings. The “Compass” taking proactive steps in this direction is a positive sign.
The EFPIA has highlighted the need for increased public investment in R&D within the pharmaceutical sector to counter the growing investment gap with other regions. Does Ireland need to do more to support pharmaceutical innovation?
“Yes, Ireland absolutely needs to invest more in R&D. without a robust pipeline of innovative therapies and treatments, the industry will struggle to maintain its growth trajectory. Public funding for R&D is vital to fostering a culture of innovation.”
Ireland has historically balanced attracting both US and Asian companies. Do you anticipate a shift in investment patterns in light of the “Compass,” particularly considering the reshoring emphasis?
“That’s a good question. The “Compass” may have a subtle influence on investment patterns.However, Ireland’s strategic location, skilled workforce, and established infrastructure remain strong draws for international companies. Our focus should be on maintaining a competitive ecosystem that attracts investment regardless of its geographical origin.”
A key challenge facing the pharmaceutical sector is the loss of exclusivity for approved drugs. How concerned are you about this trend, and what actions do you see as necessary to address it?
“The loss of exclusivity is a serious concern. It can significantly reduce the financial return on investment for pharmaceutical companies, potentially hindering future innovation. The “Compass” should consider mechanisms to balance the interests of patients and innovators, ensuring that the incentive to invest in research and progress remains strong.”
Looking ahead, what do you see as the biggest opportunities and challenges for Ireland’s pharmaceutical sector in the context of the EU’s “Competitiveness Compass”?
“The opportunities are centered around leveraging Ireland’s strengths – our skilled workforce, supportive regulatory environment, and strategic location.We can capitalize on the reshoring trend and become a key hub for advanced pharmaceutical manufacturing within Europe. Though, the challenge lies in maintaining our competitive edge in a rapidly evolving global market. We need to continue to invest in R&D, embrace innovation, and continuously adapt to the changing needs of the industry and the patients we serve.
