On July 18th, Ursula von der Leyen successfully won her re-election bid for the Presidency of the European Commission. Her victory in front of a packed, newly established, right-leaning European Parliament was accompanied by the publication of her 2024-2029 political guidelines, which set out her ambitions to help drive Europe’s competitiveness. Among her solutions: “making the most of the biotech revolution.”
Even if you are unfamiliar with the term biotechnology, you likely already know some of its applications—it was central to developing vaccines for COVID-19, for instance. To oversimplify, biotechnology makes use of living things or systems—bacteria, enzymes, genetic engineering—to develop new products and technology.
While many of the most exciting applications of the biotech revolution von der Leyen mentioned are in healthcare, it also extends to agriculture, where it could help make crops more resistant to extreme temperatures and pests. It similarly boasts tremendous potential in industrial manufacturing, helping to produce biofuels and biodegradable plastics. Taken together, biotech is interwoven with everything from national security to food security, decarbonization to resilient supply chains.
Little surprise then that legislators around the world are focused on it. The Indian Government has a Department of Biotechnology, as well as a wave of policies and schemes to encourage innovation and investment. The UK, which according to one estimate only boasts slightly fewer biotech firms than world-leading US, offers grants focused on biomedicine, alongside a highly developed regulatory system—its Human Tissue Authority, for instance, oversees the use of human tissues in research and therapy.
In 2022, the same year President Biden issued an Executive Order on biotechnology and biomanufacturing, The Wall Street Journal said biotech might be “the next US-China battleground.” That battle is not only for developing technological breakthroughs, but also ensuring domestic production—many American drugmakers rely on compounds produced in China, just as many hospitals rely on gene-sequencing machines from the country. And it is heating up—the US’s bipartisan Biosecure Act, which recently passed a vote in the House of Representatives, aims to ban collaboration with certain Chinese biotechnology companies.
Which brings us back to the EU. That it wants to unleash a biotech revolution within its own borders is not exceptional; but some of the challenges it faces to do so are.
A few of those challenges were highlighted in a much-anticipated report by Mario Draghi, a former Italian Prime Minister and President of the European Central Bank. Published in September 2024, the report examines what it would take to make Europe more competitive in the global economy. “Europe largely missed out on the digital revolution led by the internet and the productivity gains it brought,” Draghi wrote. The first and most important step to avoiding a repeat: “profoundly refocus [the EU’s] efforts on closing the innovation gap with the US and China, especially in advanced technologies.”
This focus on making Europe more competitive, and on unleashing the biotech revolution, creates an opportunity for organizations to get involved.
A 2024 report by the European Commission’s Joint Research Centre found that the US produced 39% of all biotech patents globally in 2020, followed by the EU with 18% and China with 10%. The global biotechnology market was worth €720 billion ($793 billion) in 2021, according to the report, and growing 18% annually. The US contributed 60% of that total value—five times that of the EU.
Earlier this year, the European Union launched the biotechnology and biomanufacturing initiative “Building the future with nature,” which will be followed by a European Biotech Act in 2025. The stated goal of these initiatives: make it easier to “bring biotech from the laboratory to the factory and then onto market.”
In these and other efforts the EU is hoping to replicate some of the features that make the US so successful: government funding to support research and talent, coupled with a favorable intellectual property environment and regulatory framework.
And it is looking to address one of the EU’s fundamental challenges: a fractured market. Consider healthcare, for instance. “In Europe, while there is the EMA (European Medicines Agency), you effectively have 27 different markets for new therapies,” says Claire Skentelbery, Director General of EuropaBio and Chair of the International Council on Biotechnology. The US, on the other hand, is a single market. And that—coupled with its size—presents an attractive destination for private investment.
Skentelbery suggests that to overcome the persistent barrier of the fragmented EU system, the European Commission could focus on “ensuring alignment among member states by encouraging common language and minimizing the differences in the types of information requirements for innovations across Europe.” This will be important for smaller biotechs and attract larger players who can benefit from the cost-savings of a more-streamlined process.
This new act is part of the European Commission’s broader Strategy for European Life Sciences. That strategy includes other sector-specific legislation, like the hotly debated revamp of the EU’s laws on pharmaceuticals. And this is all happening while other important regulation is being implemented (such as the Clinical Trials Regulation), and upcoming legislation (such as the European Health Data Space, a game changer for European researchers and the rare disease community) is set to take effect.
Will this be enough to make Europe competitive with their allies across the pond? And, even more broadly, can legislation alone create the right incentives?
“It is not all plain sailing for the biotech sector,” says Skentelbery. “You can create the push factors, but you also need pull factors.”
Claire Skentelbery, Director General of EuropaBio and Chair of the International Council on Biotechnology
Skentelbery highlights important differences between how different sectors approach biotech—differences that “dictate how much research is translated and the eventual economic and citizen benefit it could then deliver.” In healthcare, for example, biotechnology is linked to advanced therapies like immuno-oncology, which basically uses the body’s immune system to fight cancer. With therapies like these, there are “significant challenges to adoption posed by health system readiness, and constrained health budgets,” says Skentelbery. “We know that government funding for early-stage research is as good as they would like to make it, but you can only push the sector so far that way; you need to ensure it ends up in the destination products and processes.”
Or take manufacturing. “There are industrial thresholds which must be met for it to compete with traditional manufacturing, and if you look at petrochemicals, for instance, you’re competing with 100-plus years of efficiency improvements.”
Other challenges that loom—in the US as well as the EU—are pricing pressures and protecting intellectual property rights. Geopolitical tensions could also restrict the talent and investments that will be so crucial to biotech’s future.
And then, of course, the EU’s 27 member states each have important roles to play in the legislation they enact. Take Italy, for example. Pierluigi Paracchi, Co-Founder and CEO of Geneta Science and Moderator of the newly formed Working Table for the Internationalization of Biotechnology Sector at the Italian Ministry of Foreign Affairs, says that “significant challenges exist in Italy’s tech transfer. A critical mistake is not centering the entrepreneur in the tech transfer process to launch new emerging companies. Italy boasts excellent research, including world-class levels in gene and cell therapy for example. To retain these strategic assets and prevent their migration to leading countries, investments must match the level seen in more advanced nations. A bold vision for Italy involves government intervention and public investments to foster a competitive life sciences sector, ensuring sustainable growth and international cooperation with Allies.”
This focus on making Europe more competitive, and on unleashing the biotech revolution, creates an opportunity for organizations to get involved. In particular, businesses should consistently engage—at both the EU and national level—to help shape Europe’s future framework for biotechnologies and pharmaceuticals. We’ve seen (and written about) it before on other issues, from regulating AI to incentivizing antibiotic production—policymakers appreciate thoughtful input from the private sector. It’s a conversation that is vital for the future of Europe’s competitiveness—and one in which companies can engage, and help inform.