Healthcare systems are often seen as requiring an economy of scale. This in part is a function of how prevalent diseases are, such that in some small countries they would have one case in 2 years, rather than one case per million of population. Healthcare technologies can be incredibly pricey; for instance, a proton therapy facility will run between €100 and €200 million to set up. Healthcare buildings and research infrastructure are expensive to build and run. Health professionals can be expensive to train and employ and are generally globally mobile.
Associated with investment in healthcare within the EU, we find that almost every region or member state has life sciences, in some form, in their top 5 or so areas of national priority. Life sciences is challenging and demanding, and requires high degrees of global visibility and connectivity to other researchers. Commercialisation of life sciences in Europe is not great; the EU’s research budget does not strictly speaking focus on research translation and there is precious little to help good ideas bridge the ‘valley of death’ where unfunded good ideas go to die. Financing for life sciences developments consume vast quantities of risk capital, some of which will be unlikely to return any value for a decade or more. The problem is not for the EU, but for the risk appetite in member states: it is difficult to raise more than €30 million or so in venture funding in Europe. The brooding presence of state interference in entrepreneurial start-ups can be discouraging. And with the UK leaving the EU, a liberal enterprising culture will be lost within the EU. Statist solutions in Europe tend to dominate.
Many EU countries try to avoid downside risks of failure by punishing it, rather than creating opportunities to learn. Countries that encourage risk taking, and make it easy to start and close down companies, with associated flexible labour practices, will outstrip protectionist fearful countries. Many countries protect jobs not workers, so actually create unemployment and discourage job creation. Life sciences is one such area that requires particular flexibility owing to the nature of the work.
Small countries are particularly interesting. In one of the EU’s small states, there has been active progress developing a bioscience research and commercialisation centre (partly funded by the EU, thanks for that). Higher education is active across life sciences, though the research is of middling status globally, but that is typical of most of Europe’s universities. The country has a well-developed and well-financed healthcare system, recognised as one of the best globally based on outcomes.
Building life science (or any research-based commercial capacity for that matter) means that setting priorities is more important the smaller you are, as you can’t do everything. That means grappling with disappointment as not everything can be done, and if trying to do everything, mediocrity abounds. It means, too, that infrastructure projects are precious, as they are enablers of future potential — the longer term vision must be sustainable, as getting it wrong can be expensive — research buildings don’t make very good hotels and what do you do with failing science parks like we see across Europe.
What Cognology says.
- build on what you already are doing well as that is evidence you have the expertise, networks and working practices in place
- keep in mind that life sciences is much, much more than drugs; progress may be quicker in other areas, such as informatics, telecommunications, bio-engineering, materials science, agricultural biotech, etc.
- you can’t sensibly do life sciences with a weak university, so this entails difficult and hard rethinking of priorities and a sensible review of research productivity
- you can’t sensibly do life sciences without a teaching hospital; the academic health science centres in the US account for over 80% of productive life sciences research, so the infrastructure should enable closer collaborations and alignment between university and hospital and industry; this may, by the way, raise real issues for government if the teaching hospital(s) is state run and therefore subject to bureaucratic overhang
- you can’t sensibly do life sciences without understanding the logic of ‘bench to bedside’; productive work lies in translational research and solving clinical problems; this can challenge academics whose careers are rewarded from the production of papers and volume of research funding rather than solving problems; in life sciences, solving problems is paramount; understand what the Grand Challenges in life sciences are and see which one(s) you can focus on and ignore the rest
- you’ll need to consider the economic developments that come with building a life sciences sector to energise high net worth individuals in the country to develop a risk appetite for national investments along with a cadre of managerial expertise to take start-ups forward; I’d discourage doing this through the public sector hiring as it disincentivises university graduates from pursuing entrepreneurial careers (there is good global evidence that this can be a problem, so don’t make that mistake); best role for government is ensuring a flexible corporate start-up environment, a non-punitive bankruptcy regime, sensible taxation of start-ups, and seed funding; it might also be a good idea to give away all that publicly owned intellectual property
- finally, the good news is that size doesn’t matter for innovation; there is no correlation between the size of a country and the ability of the country to innovate; many very large countries have clumsy policies that disincentivise and frustrate; the EU is full of them and in the main, the governments have assumed the wrong type of highly interventionist policies rather than creating an enabling culture that does not punish failures and really does reward success.