Here an excerpt of Competere’s feedback to European Commission consultation on the new plan for Pharmaceuticals.

Innovation is fundamental for economic growth. Therefore, European Commission should avoid implementing policies that threaten or constraint it. As a think tank focused on innovation policies, our aim is to help the European institution to pursue the specific objectives of the Pharmaceutical Strategy and implement its roadmap.

ACCESS AND AVAILABILITY TO IMPROVE CITIZENS’ WELFARE

Objectives 1) Ensure greater access and availability of pharmaceuticals to patients and 2) Ensure affordability of medicines for patients and health systems financial and fiscal sustainability are pivotal to improve the welfare of European citizens.

For this reason our hope is that the Commission will encourage investments in sectors with a high technological content, and will reconsider its support to the sectors that do not favor innovation and have very low margins. At the same time, the Commission should not intervene to set a cap on drug prices, as Europe did in the 1980s, research and innovation suffer.

PRICE CONTROL DO NOT WORK IN PHARMACEUTICALS SECTOR

Firms, in fact, are unlikely to invest in future research unless they believe doing so will be profitable. Private firms routinely exit markets—and entire industries—once they lose profitability, even as they try to enter new, more promising markets. Price controls reduce industry R&D, which decreases the number of new drugs developed and thereby hurts patients in the future. It is simply not true that government can impose significant price controls without damaging the chances for future cures. Countries that allow higher drug prices experience more innovation. They also benefit from a more competitive domestic industry and more good jobs.

New regulation framework should aim at reducing the cost of drug development, which would likely result in both lower prices and increased investment in R&D. Commission and EMA should continue to improve and streamline, wherever possible, the drug approval process, keeping in place existing safety and efficacy standards.

Another option is to encourage more innovation in drug manufacturing. Recent studies argues that pharmaceutical manufacturing could be more efficient. They attribute much of this to high regulatory barriers and inefficient intellectual-property protection of manufacturing methods. Fostering IP rights is fundamental to give innovators incentives and gurantee revenues for their effort, especially in intense R&D sectors such as pharmaceuticals manufacturing.

DEVELOPING INTERNAL MANUFACTURING 

Pursuing objective 4) Support EU influence and competitiveness on the global level, reduce direct dependence on manufacturing in non-EU countries, seek a level playing field for EU operators should also take into account a pro-market approach, balancing it with the needs of ensuring citizens access to the most innovative therapies and drugs.

We recognize that dependencies for medicines and medical supplies, especially when centered on non-market-based economies, can present serious national security vulnerabilities that must be urgently addressed—one of the reasons why a realistic mapping of such vulnerabilities is needed.

Anyway, the way to achieve the objective is through innovation and stronger IP incentives, rather than restrictions. European citizens need policies that encourage market and especially the introduction of new innovation and the development of new products rather than penalizing competitors.

Finally, European Union should put a huge efforts in fostering technological innovation and knowledge in order to become more competitive. Evidence suggests that developing innovative therapies would create shorter supply chains in the vicinity of local laboratories (EU based) rather than global chains.