With investments of 50 billion euros in R&D in Europe in 2023, the European pharmaceutical industry (including Greece) is the sector that invests the largest percentage of its revenues in R&D, as is evident in the annual financial report published by EFPIA.
However, as mentioned in the Federation’s relevant publication, last year, China overtook Europe in terms of circulation of new active substances worldwide. And after Europe lost first place to the US as the world’s leading innovation region in 2000, it is currently in third place.
In particular, according to Eurostat data, the pharmaceutical industry is the high-tech sector with the highest value added per worker, significantly higher than the average value of high-tech and manufacturing industries. The pharmaceutical industry is also the sector with the highest ratio between investment in R&D and net sales. As recorded in the 2023 EU Industrial R&D Investment Scoreboard, healthcare industries as a whole invested around €261.4 billion in R&D in 2022, representing 20.9% of total business expenditure in R&D around the world.
But it is the research-based pharmaceutical industry that can play a key role in Europe’s return to growth and ensuring future competitiveness in a growing global economy. In 2023, it invested around 50 billion euros in R&D in Europe. Although it directly employs around 900,000 people and creates around three times as many jobs indirectly.
However, the industry faces significant challenges. In addition to additional regulatory hurdles and rising R&D costs, the industry is already being hit hard by the effects of fiscal austerity measures introduced by governments across much of Europe since 2010.
IQVIA data (MIDAS May 2024) shows that 67.1% of new drug launches in the period 2018-2023 occurred in the US market, compared to 15.8% in the European market.
Over the same period, the markets of Brazil, China and India grew by 12.3%, 5.4% and 9.9% respectively, compared to the average market growth of 7.4% in the top 5 EU markets and of 8.4% in the US market.
In 2023, North America accounted for 53.3% of global pharmaceutical sales, compared to 22.7% recorded by Europe. The fragmentation of the EU pharmaceutical market has resulted in profitable parallel trade estimated at €6,366 million in 2022.
However, this benefits neither social security nor patients and deprives the industry of additional resources to finance R&D. At this time of political change in Europe, EFPIA calls on EU leaders to work with industry to create opportunities to make Europe a world leader in life sciences.