European Pharma Giants Warn of Decline, Urge Policy Overhaul to Compete with US, China

A coalition of nine top European pharmaceutical company chairs has publicly called for significant policy reforms, warning that Europe's pharmaceutical industry risks a steady decline as it loses its competitive edge to the United States and China.

A Call for Urgent Action

In an open letter published on their companies' websites, the leaders of drugmakers including AstraZeneca, GSK, Novo Nordisk, Novartis, Roche, and Sanofi urged the European Union and its member states to boost investment and streamline regulations. They warned that without immediate changes, strategic sectors like pharmaceuticals face a "'slow agony' of decline."

The letter specifically calls for increased government spending on medicines, faster clinical trial processes, and stronger intellectual property (IP) protections. "European governments must create conditions that attract investment in next-generation medicines before it’s too late," the chairs stated.

Declining Competitiveness in Numbers

The executives supported their claims with data highlighting a significant shift in the global pharmaceutical landscape. They noted several concerning trends for the European bloc:

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• Europe's share of global drug research and development (R&D) has fallen from 43% in 1990 to 31% today.
• Its share of commercial clinical trials has been halved over the last decade to just 9%.
• The continent spends approximately 1% of its GDP on pharmaceuticals, compared with 2% in the United States and 1.8% in China.
• An estimated 40% of new therapies never become available to patients in Europe.

Investment Climate Concerns

The warning reflects growing frustration within the industry over what are seen as slower regulatory systems and less favorable investment policies compared to global rivals. Billions more in pharmaceutical investments are now flowing to the US and China, which are perceived to have more aggressive and supportive policies.

According to Amsterdam-based healthcare lawyer Ron Lanton, the issue extends beyond R&D funding. He noted that companies evaluate the entire process, "from clinical trials to reimbursement and patient access when deciding where to put capital." This holistic view of the market environment is increasingly favoring investment outside of Europe.