The Lifescience Sector in Europe

Position

The Lifescience Sector in Europe

Federation of German Industries e.V.

Date: 12.03.2019

The Lifescience Sector in Europe

Contents 1. The impact of the lifescience sector in Europe ...................... 3 2. Why does the lifesciences sector need better regulation within the EU? ................................................................................. 3 3. Translating science into benefits for patients ........................ 4 4. The digital revolution at the service of citizens’ health ......... 7 5. A coherent regulatory framework............................................ 9 About BDI ....................................................................................... 11 Imprint ............................................................................................ 11

The Lifescience Sector in Europe

1. The impact of the lifescience sector in Europe The lifescience sector1 makes a major contribution to addressing Europe health needs, whether that is in the areas of prevention, chronic diseases or to develop solutions to European and global health threats, strengthening Europe’s health independence.

The lifescience sector is the most R&D intensive economic sector in Europe and drives Europe’s innovation agenda and objectives for the “knowledge economy”. It is also part of a much broader science and R&D infrastructure through the role it plays in education and employment in research and development, creation and growth of lifescience clusters of SMEs, medical devices industries, ‘big pharma’ and its partnerships with academia and research centres.

The lifescience sector makes a significant contribution to Europe’s jobs and growth objectives. R&D investments have high economic impact and the lifesciences sector contributes significantly to the EU trade balance.

2. Why does the lifesciences sector need better regulation within the EU?  As the lifescience industry is undergoing a number of changes and challenges, Europe needs to keep pace and continue to be a major global hub for investment in lifescience, R&D and manufacturing in a context of strong global competition.  Requires for Europe and the members States to strengthen their strategic independence in the use of the therapeutic solutions.  Lifesciences is a highly regulated and complex sector impacted by a multiplicity of policy areas – a coordinated approach based on welldefined objectives is imperative.  Europe’s ability to remain a leader in healthcare innovation depends on regulators, industry and civil society developing new models of collaboration in research and care.

The fast pace of scientific discovery and development of novel technologies should benefit Europe as a whole – a European perspective on certain key areas is better than a fragmented country-by-country approach.

The opportunities offered by an integrated approach of different technologies in care pathways – “beyond the pill” – and the need to measure and incentivize that performance based on outcomes will require an adaptation of member states’ healthcare systems, skills, infrastructure and capability building. These are areas in which the EU can play a supporting role.

1

Understood as being the biotech, pharmaceutical, vaccines, diagnostics, health IT and medical devices sectors.

The Lifescience Sector in Europe

The transformational nature of capabilities in data collection and analysis and the impact this has on the discovery, development of innovative technologies as well as on the provision and management of care play a major part in this respect.

The EU is not immune to global health emergencies requiring an abovecountry and often rapid response (antibiotic resistance, communicable disease threats, impact of global warming on health). There are important considerations regarding incentives, manufacturing etc. that will need to be taken into account in order to ensure Europe’s health independence and ability to respond.  Transform the scientific excellence into economic value and industrial competitiveness, and open up the lifescience sector, the scientific expertise and the Health enterprises.  Enhancing Europe’s ability to attract and retain R&D.  Strengthen the path from invention, R&D, production, marketing, distribution and reimbursement.  Strengthen Europe’s ability to generate game-changing innovation in healthcare that meets the needs of its population.  Make the necessary changes to enable healthcare systems to effectively integrate innovations.

Europe benefits from a unique set of conditions which would allow it to play a leading role in the sector of health industries, for example: well-developed healthcare systems, excellence of medical professionals and infrastructure, academic networks and medical and science education, the traditional lead countries for R&D with a broad array of programmes in place to encourage start-ups, partnerships etc. and the coordinating and supporting role of the EU. 3. Translating science into benefits for patients Generating innovation in the field of lifesciences is a complex process. The R&D landscape is changing substantially through a multi-layered network between academia, medical devices enterprises, small biotech start-ups and ‘big pharma’, with biotech firms characteristically supported by venture capital and originating from cooperation with academia or research institutes.

It is characterized by multiple format of public private partnerships and ‘open innovation’ models.

However, as the European Commission has pointed out in the recent report 'Science, Research and Innovation Performance of the EU' , technologies developed in Europe are often commercialized elsewhere with evidence showing that “the EU continues to be locked into a specialisation pattern in which high-tech activities such as ICT, pharma or biotech are underrepresented”. www.bdi.eu

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The report presented a detailed analysis of the EU’s science, research, and innovation performance in relation to three challenges:  converting research results and new technologies into innovations on the market  improving the EU’s share of the very best scientific output in the world  helping Europe to improve its standing in international research cooperation and science diplomacy Europe’s economy and society is also not doing as well as it could at absorbing and profiting from new technologies. A recent report by Science Europe highlights that: “Europe’s productivity growth lags that of many of its trading partners – in no small part because of the slow uptake of technologies. Boosting innovation and our capacity to absorb it, then, should matter to every European, not just a few researchers or entrepreneurs”2.

Lifescience innovations, whether they are categorized as breakthrough, disruptive or incremental will radically change how we treat patients and can accelerate translation of science into new and more effective diagnoses and treatments, and solutions for disease prediction and pre-emption. The European Commission should create a platform of shared vision of fostering lifescience innovation in Europe and maximising benefits for all Europeans, focusing on:  Improve Open Innovation: Open Science aims to promote greater collaboration, access to and reuse of research data and results and is the foundation of excellent science and innovation.  Enhance engagement and collaboration across multiple stakeholders focused on solving difficult scientific, clinical and business model challenges.  Increase coordination of national programmes in support of R&D and streamlining of EU programmes. Europe needs to focus on strategic and coordinated structural investments that can help build sustainable innovation hot spots, support to the business environment at all phases of start-up companies from the initial idea to bringing the product to market and enabling viable financial markets of interesting size where share of such companies can successfully be traded, to strategic funding of innovation.  Greater understanding of existing gaps and strategic calls with the ability of enabling cooperation between related projects could improve the effectiveness of investments in particular for Horizon 2020.

2

“The EIC: Breaking through, scaling up”, Science Europe, 2015.

www.bdi.eu

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The Lifescience Sector in Europe

 Increase level of public and private investment into R&D – here, the track record of the EU is sub-optimal vs. key competitors globally.

The issue of financing is particularly critical in the biotech and medical devices sector where there is a high number of smaller companies and start-ups that developed based on one innovative molecule or medical device. Getting more actors involved in the innovation process and creating an ecosystem in which innovation flourishes is “intimately linked to the fact that we do not yet have the correct conditions in place to attract enough private sector investment in innovation and for innovation-intensive businesses to grow and become major global players. Further progress needs to be made in relation to the availability of venture capital, the reduction of heavy product market regulations and in removing barriers to entrepreneurship and ease of doing business.”3  Maintain a stable IPR framework. IPRs do not prevent competition but, rather, patents stimulate innovation and disclosure of scientific knowledge. Competition on innovation fosters dynamic efficiency, the better replacing the merely good. There are very few areas where patents play such a vital role as in the lifesciences sector.  Encourage predictability for health innovations. There is a lot of risk in the pharma, medical devices and biotech business while predictability of what works and what won’t work with public payers in Europe is low. In addition, the focus of investors and venture capitalists is today strongly directed at areas of high unmet need.

Authorities’ attitudes towards innovations have a knock-on effect on what projects get funding. Setting public health priorities, prioritizing research activities and pricing/reimbursement decisions should be informed by a better understanding on both sides of unmet need.  Avoid a stalemate: patient access to and affordability of innovative medicines and budget pressures of healthcare systems are dominating the debate on pharmaceuticals, medical devices and other health technologies. The EU has no competence in addressing pricingrelated issues, but it can: ▪ play a more active role in driving efficient systems for horizon-scanning and early dialogue between manufacturers, the EMA and public authorities (outcomes focused, adaptive pathways, combination approaches, others) ▪ support efforts to better manage the “value gap” between a newly launched medicines’ available evidence and realworld evidence needs throughout the product lifecycle, while taking the data protection dimension into account ▪ drive uptake in national P&R decision-making processes of joint Relative Efficacy/Effectiveness Assessments

3

http://www.innovation.public.lu/fr/brochures-rapports/s/science-research-eu/science-research- eu.pdf.

www.bdi.eu

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The Lifescience Sector in Europe

4. The digital revolution at the service of citizens’ health Digital health can support healthcare systems in addressing the major challenges they face (ageing population, chronic diseases). Big Data can be a powerful tool to develop personalised medicines and foster our understanding of diseases and their mechanisms of action. Most importantly, from the perspective of the patients’ community: data saves lives!  Digital technologies are changing healthcare by enabling three fundamental shifts: ▪ Customer empowerment: access to new sources of information ▪ Greater connectivity at lower cost: physicians connecting to patients, patients connecting to other patients; the possibility of connecting remotely ▪ Generation of new and massive sources of data (e.g., through continuous monitoring)  Digital revolution is also redefining the patient’s position within healthcare systems, allowing them to better monitor their health and handle routine analyses. The medical device sector is playing a major role in this field.  Big Data opens new possibilities in the discovery of new therapeutic approaches and technologies, as the sector is facing a flood of data never seen before and working with highly diverse data, some of it coming from novel sources such as lifestyle data, payer data and social media.  The General Data Protection Regulation by the EU is an important step towards a less fragmented approach on the rules regarding the use of data for research purposes. As Europe moves towards a datadriven economy, it is of crucial importance that Data Protection rules in Europe preserve patient confidentiality while allowing innovation in healthcare products and services for the benefit of patients in Europe. The ability to capture and exchange patient real world data has huge potential to advance the fundamental scientific understanding of diseases, better address medical conditions that will lead to better outcomes for patients and contribute to the effective and efficient management of health systems. A coherent implementation of the EU Regulation across member states will be critical.

MEDEF/BDI are committed to work with national authorities, the European Commission, academia, patients associations and other stakeholders during the implementation period to put in place a system that will boost research in Europe while protecting the privacy of empowered patients.

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 The value of Big Data in R&D is threefold Develop personalized medicine through patient stratification.

▪ It will improve efficiency of drug approval process by focusing on the right target population and address each patient with the right customized treatment ▪ Illustration = We are now able to integrate biological, clinical and environmental information to develop predictive models, learning systems, and continuous quality improvement at the individual level that enable to identify new disease biomarkers and subtypes Foster understanding of diseases and their mechanism of action.

▪ It will accelerate the design of treatments by developing new pathways and therefore will allow patients to get access to new effective drugs with less adverse effects Improve our action on adverse effects.

▪ This axis will allow us a better control of a drug in terms of usage and reputation in the market place and will give the opportunity to patients to be better informed about the risks associated with drugs in a given patient population ▪ Illustration = Web-based data & new digital usages social networks, connected devices - generate large amounts of new data. Data give us access to a pool of information on drug usage directly from the patient.  This will also further drive integrated care, especially in complex chronic diseases like diabetes, where the need of patients and healthcare systems goes well beyond the drug. They need support in managing the disease to achieve a better health outcome. Digital technology and especially continuous monitoring and advanced analytics open up new possibilities in integrating drugs, devices, and informed coaching to help manage disease.

The EU should provide enhanced framework conditions in the following:  Digital Single Market (DSM): barriers in the Single Market for digital services and products should be reduced, including through harmonized implementation of the General Data Protection Regulation (GDPR);  Promotion of international flow of data provided that the same rules apply to the same services across the world;  Common approaches of cybersecurity; member states and the European Commission should work on a swift conclusion of the

www.bdi.eu

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“Privacy shield” agreement. Restoring legal certainty to the data flows is essential for transatlantic trade and investment.  Support to investments in connectivity and provision of a high performance digital infrastructure. We need a high-performance IT infrastructure that can technically manage the immense volume of data created by the Internet of Things. This implies full coverage of broadband internet  E-health/m-health: harmonized requirements across member states would serve as a driver to innovation, as it would facilitate exchange of relevant data in support of innovation.

5. A coherent regulatory framework Regulation has an important influence on innovation and priorities of innovative companies. Regulatory certainty can be considered one of the important factors to drive innovation, with non-harmonised interpretation and implementation of decisions delegated to Member States often creating barriers to innovation.

New EU regulations have been introduced or proposed including the medical devices’ regulation, and pharmaceutical legislation which includes the Clinical Trials Regulation, the Pharmacovigilance Fees Regulation, the Falsified Medicines Directive, the Transparency Directive, and coverage of Pharmaceuticals in the Environment via the Water Framework Directive. A directive on advanced therapies is coming through, finally, and it will make provision for new treatments like gene therapy and somatic therapy. The regulation and control of that falls within a number of different regulatory areas, but that directive is an example of the EU responding to a particular need in terms of development of the science.

Now is a time of tremendous discovery. Innovation in healthcare and life sciences is moving so fast that the legislation is finding it difficult to keep up.

The EU’s challenge will be how to keep pace with that fast moving technology without falling into the trap of over-regulation.  There is a need to address the more structural barriers to innovation in Europe and support innovative and collaborative ecosystems at a broader level. The EU would benefit from a deeper review of the true structural barriers to innovation. This is particularly the case for science-driven sectors, where academic and private collaboration is critical.  Where we are seeing little to no progress is in an increased coordination between the different Directorates General in the European Commission, despite the new Commission’s pledge to a less silo-driven approach to the development of policies. An environment supportive of innovation goes beyond consistent regulation and requires coordination of several European

www.bdi.eu

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 

 

Commission services beyond Directorate-General for Research & Innovation.

With science moving so fast, it will be essential to be strongly evidence- based and enabling scientific input in drafting legislation much earlier than it currently is.

Whenever EU institutions consider policy or regulatory proposals, their impact on innovation should be fully assessed and addressed.

We would strongly argue in favor of a routine evaluation of impact on innovation, within the EU Commission’s revised impact assessment procedures, including implementation of legislation and delegated acts.

We would also call for a routine consultation with innovative organisations, from both public and private sectors, spanning the full range from university spin offs and SMEs to large multinationals.

We are not yet seeing a strong understanding of how the financing of innovation process works throughout R&D. We would like to see the development of a more holistic understanding of what it takes to succeed as an innovator and which barriers to entrepreneurship are encountered, and would like to see a gathering of best practices in innovation policy to stimulate adoption at both member state and European levels.

www.bdi.eu

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About BDI The Federation of German Industries (BDI) communicates German industries’ interests to the political authorities concerned. She offers strong support for companies in global competition. The BDI has access to a widespread network both within Germany and Europe, to all the important markets and to international organizations. The BDI accompanies the capturing of international markets politically. Also, she offers information and politico-economic guidance on all issues relevant to industries. The BDI is the leading organization of German industries and related service providers. She represents 36 inter-trade organizations and more than 100.000 companies with their approximately 8 million employees. Membership is optional. 15 federal representations are advocating industries’ interests on a regional level.

Imprint Federation of German Industries e.V. (BDI) Breite StraĂ&#x;e 29, 10178 Berlin, Germany www.bdi.eu T: +49 30 2028-0 Contact Michaela Hempel Senior Manager phone: +49 30 2028 1493 m.hempel@bdi.eu BDI document number: D 1016

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