o meet the needs of patients and to drive competitiveness, Europe needs a consistent and predictable regulatory framework to attract investment and expertise and support innovation. Here’s how we can do it together.

Europe has many strengths in the health space, including strong education and healthcare systems, and a diverse community of expertise and cultures. However, to fully realize its place on the research and development (R&D) innovation map, Europe should strive to become a magnet for investment and talent. To achieve this, stakeholders must work together to dissolve regulatory silos and engage in proactive dialogue on how to meet the needs of tomorrow’s patients.

The DIA Europe meeting in March 2024 provided a forum for policymakers, academics, regulators, industry, investors, patient-centric research foundations, and patients to make valuable contributions to this urgent conversation. Together, we are focused on proactive steps to address the interplay between various policies and regulations that apply to the new and emerging advances in innovative healthcare. It is vital that this dialogue continues and actions are implemented.

Key points

• The global clinical trial environment is competitive, requiring long-term vision to decrease the bottlenecks to approving trials in Europe
• Europe’s strengths include its diversity and high levels of expertise
• The EU must find ways to release venture capital to turn great science into medicines for patients
• Investors’ cautious attitudes to financial risk can hold back investment
• The legislative environment reflects societal needs, but the interplays between various EU regulations can produce unintended complications
• Innovators, patients, and policymakers can work together to streamline regulation and foster innovation

Complexity in the Regulatory Landscape

The fast-moving nature of innovation and the intrinsic challenges of operating across a diverse continent make complexity somewhat inevitable. Therefore, this mosaic of policies and legislation can be complicated to navigate. By engaging in regular dialogue to identify unforeseen cross-sector implications/complications and find creative ways to achieve the vital goals of regulation while reducing unnecessary complexity, stakeholders can accelerate progress.

There are concrete actions that can be taken as first steps. For example, policymakers can ensure that new and revised legislation is assessed for consistency with other legislation already adopted or in drafting. This would help to avoid unintended impacts beyond the immediate sector to which the legislation is addressed. Legislation should be reviewed to ensure it strikes the right balance between benefit and risk in the evaluation of healthcare products, such as medicines and medical devices, and includes room for regulatory frameworks to flex as new science emerges.

Regulators can issue guidance and tools that support related policy goals such as climate and environmental considerations in tandem with supporting medical innovation. Policymakers can provide fora for dialogue with other European agencies, international decision-makers, patients, and all stakeholders in the drug development field. Together, stakeholders can collaborate to foster a science- and risk-based approach to regulation. Such regulatory sandboxes ensure that a pragmatic and flexible approach is taken to cutting-edge innovation, including across sectors.

As the scale of this shared challenge is likely to grow in the years ahead, investing in multiparty conversation will pay dividends across the innovation ecosystem for decades. The latest wave of medical innovation often combines therapies, diagnostics, and digital tools. Such products may be covered by legislation on medicines, medical devices, diagnostics, chemicals, food, environment, data, AI, and other sectoral and horizontal regulations. In addition, products are often subject to multiple other broad pieces of legislation such as the Critical Entities’ Resilience Directive.

These policies and regulations can, in some instances, inadvertently contradict the principles on which quality, safety, and efficacy of medicines rely. Complications arise where there are inconsistencies, differing priorities and timelines, and no single authority in place to decide which rules apply. This exacerbates uncertainty for investors and threatens continuity of supply for patients in Europe.

All of this strengthens the case for breaking down barriers between various actors in the health innovation space, so that we can deepen our understanding of the problem. Only with this approach can we expect to find solutions that work for all.

Building on a Sound Foundation

European R&D competitiveness may be under pressure, but it has a solid foundation on which to build. Its diverse community of expertise and cultures, excellent academic institutions, and strong public-private partnership initiatives give Europe opportunities to foster a more favorable ecosystem for medicines innovation. In areas such as rare diseases, the EU has supported the development of European Reference Networks to connect experts, and to connect patients with knowledge and quality care.

The European Commission (EC), National Competent Authorities (NCAs), and the European Medicines Agency (EMA) are increasingly supportive of innovation and early dialogue with innovators, notably through support for small and medium-sized enterprises (SMEs), Innovation Task Force, the Priority Medicines scheme (PRIME), and the recently established Quality Innovation Group (QIG). These bodies provide opportunities for engagement with regulatory authorities that are less formal than the scientific advice and protocol assistance that developers can request from the regulator. Furthermore, an even closer proactive collaboration between agencies, including the EMA, HMA, European Chemicals Agency, European Monitoring Centre for Drugs and Drug Addiction, European Food Safety Authority, and Notified Bodies would help to reduce inconsistencies.

In addition, funding for research and innovation has grown, notably through the European Research Council, Horizon Europe, and the Innovative Health Initiative (IHI), which provides an important platform for public-private partnership. The European Investment Fund (EIF) also supports venture capital investments. Stakeholders share a strong appreciation for universal access to healthcare across Europe, which is not a feature of all competitors globally.

Better regulation: Three steps policymakers can take in collaboration with stakeholders

1. Establishment of governance structures to perform a “consistency check” as part of legislative impact assessment (e.g., European Commission Life and Health Sciences Office)
2. Reactive and proactive action on legislative interplays, with systematic translation into guidance
3. Clarity for innovators to help them understand and navigate the legislative maze.

Europe’s Place in a Competitive World

The global environment for attracting healthcare R&D investment and clinical trial activity is increasingly competitive and requires a compelling vision for the future. Investments in research hubs and manufacturing are long-term decisions, and clinical trials are often carried out over many years. For Europe to be strategically well-placed globally, it requires a vibrant R&D ecosystem and a policy framework that keeps pace with competitors. For example, delivering efficient, predictable, clear pathways for approving and reimbursing new products, and embracing new evidence-generation approaches through a risk-based approach, would make Europe more attractive to investors.

Participants in the DIA Europe meeting panel discussions also identified a lack of available expertise and clear career paths for regulators as a potential challenge. Steps, however, are being taken to enhance good scientific and regulatory practice across the EU, notably through the EU Network Training Centre (EU-NTC) set up by the Heads of Medicines Agencies (HMA) and the EMA. This remains a work in progress but provides a platform on which to develop skills and establish clear career pathways for regulatory experts.

There are also cultural differences between Europe and its biggest competitors which will take time to overcome. For example, in the US, it is widely considered to be easier to raise capital to turn ideas into innovations, and for academics to move between research and biotech start ups. Therefore, Europe needs to find ways to release venture capital to support the translation of great science into medicines for patients.

The uncertainty and timelines associated with innovation in Europe are viewed by some investors as too risky. To attract funding, innovators need to tell a compelling story, usually involving reasonably short timeframes from research to market. The problem is not a lack of science, but the limits of investor trust and a readiness to accept risk over several years.

One thing Europe can learn from its US peers is the value of maintaining a greater appetite for managing risk, including a higher tolerance of failure. Europe must redefine failure as a learning opportunity: many success stories are written after unsuccessful ventures. One way to address this is to explore the potential of philanthropic investments as a source of risk-sharing. Incentivizing venture philanthropy, for example through tax incentives, could unlock the full potential of European science. Similarly, concrete policy measures for attracting venture capital include a concerted effort to build a strong framework for the approval and reimbursement of innovative medicines.

Philanthropy has the potential to be redefined as a research partner in the European R&D ecosystem. Patient-centric research foundations are powerhouses in networking: they are more often populated with life science veterans, highly specialized in the disease of interest, and driven by the same sense of urgency as the patient population they serve. They should deploy their time, talent, and treasure towards bridging the gaps on the path from discovery to clinical benefit.

Conclusions

It may not be possible to entirely future-proof legislation, but striking the right balance between predictability and flexibility, along with avoiding inconsistencies in cross-sector policies and legislation, can help to generate confidence in the European system’s capacity to adapt. Central to this flexibility will be a dialogue between policymakers, regulators, HTA, payers, industry, investors, patient-centric research foundations, ethics committees, and patients. There is also an important role for European agencies in leading and fostering international collaborations.

By breaking down the walls between stakeholders and tackling fragmentation across Europe, a stronger, more connected Europe can emerge. This would ensure that patients in Europe have access to the latest research and innovative therapies, while making the region a more attractive and competitive place for investment.

It is time to expand Europe’s place on the R&D map. By all stakeholders applying the principles set out above, we can inform new and revised EU legislation, policy, and guidance that influence the EU healthcare research ecosystem. Through consistent and timely collaboration at all levels, Team Europe can deliver for patients.