Life Science Acceleration Alliance e.V
LSAA
Life Sciences Acceleration Alliance e.V.
ID: 320028947950-50
Lobbying Activity
Response to Evaluation and revision of the general pharmaceutical legislation
5 Sept 2023
The EU General Pharmaceutical Legislation (GPL) will fundamentally change the life sciences ecosystem in Europe. As proposed, the legislation is a step back from Europe's historically strong support for IP protections. That policy shift compromises the EUs ambition to build a competitive and knowledge-based economy. It will exaggerate the Death Valley of European life science startups and weaken our early-stage environment, driving innovative companies out of Europe. Instead, the EU should commit to a life-science policy agenda that will support economic and healthcare goals, creating more medicines in the EU and bringing that benefit for European patients. Life Sciences Acceleration Alliance (LSAA), the pan-European coalition of investors, scientific and corporate leaders dedicated to strengthening life sciences research and development, is concerned with the European Commissions proposed legislative changes. The Pharmaceutical review represents a rare chance for the EU to renew its position as a leader in global biopharmaceutical research and entrepreneurial commercialisation, and to support its life sciences early-stage ecosystem. Conserving strong intellectual and regulatory property policies to encourage continued high-risk investments into development of innovative technologies must be part of the legislation. Risk capital is particularly important during times of global economic instability. A forward-looking legislation in this area is key for patients and industry players alike. This would allow the EU to attract biotech and biopharmaceutical entrepreneurs and move away from the current environment where promising innovations are pushed beyond EU borders. Such an approach would also ensure a stronger European autonomy and would tie in with the broader EU Industry and Competitiveness agendas. LSAAs own research indicates that venture capital investment is an essential component of the life sciences innovation ecosystem, one that is already comparatively weak in Europe. VCs in Europe raise 3-4 times less capital than VCs in the US. For example, US biotechnology companies invested 11 times more in R&D than EU companies in R&D in 2020. Today, Europe also needs to compete with China, where capital raised exceeds that in Europe and the average financing per round is 2-3 times greater. Weaker VC funding flows to Europe specifically create a Death Valley stage in early development whereby investors move out of Europe and into regions where funding availability is greater to bring new promising therapies to market. In the earliest stages of drug development, there are very few tangible assets for investors to value. This is particularly notable when considering only 1 in 10 drugs entering clinical trials will ever allow investors to recoup their investment. That is why venture capitalists the riskiest of the private capital market fill a critical gap in translating discovery into development. In exchange for their investments, which can run into tens or hundreds of millions of Euros, investors are seeking time to recoup their investment. That time is a byproduct of the intellectual property protections revised in the GPL. A strong life science ecosystem in the EU requires a conducive investment environment. As stated above, government policy is a critical component of that. The relevant policy areas, however, do not appear to align across the Commission. A recently issued report calls for strengthened venture capital investments, and other parts of the Commission have advanced policies that aim to further cultivate early-stage biotech development in the EU. These priorities seem ill-affected by the GPL as written.
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