Will regulation finally pay off for Europe?

Much is still said about sexy new emerging markets. A few years ago, we were packing up to go to India, and the South American economies were apparently just waiting to take over Europe’s life sciences sector. But as ever with such stories, the reality of these markets makes them much harder to access for R&D than headlines suggest. Europe’s tendency to regulate everything is certainly a pain in the backside, but it makes it much easier to know what is going to happen in the longer term. You just have to worry about having enough money to last the week?…little things like that.

News from India that clinical trials have been suspended by organisations as big as the NIH tells you that an awful lot of money is suddenly flying out the window and delaying approvals. The reason behind the suspension is the introduction of new liability rules for trial sponsors, which creates uncertainly following a dramatic and poorly defined shift in rules. How many more changes will come – and how long before agencies conduct trials elsewhere?

Brazil is another interesting example; plenty of money and a market comparatively untouched by global competition. In theory it’s a great new target for innovation and R&D. However, a closer look finds a much stickier situation. South America’s giant demands a 100% transfer of rights for government procurement of technology, and offers an opaque approvals process in return. It’s a tough market to crack for all stages of R&D. Universities in Europe are already muttering about freedom to use research results, while SMEs don’t have the clout or money to create partnerships or new entities. That leaves only the big global companies to sell products rather than the innovation chain behind them.

Europe has had a painful learning curve in the process of regulation. The challenge of creating legislation for more harmonised operation between countries has ensured that regulation is long-term, and that it has been argued from the perspective of 28 countries. The process might be complicated, but you know it isn’t going to change while you are making your precious investment. Europe also knows the importance of enabling technology development. An enforced loss of rights does nothing to encourage innovation, and frankly, it can’t shovel research out the door of universities fast enough. I used to worry about Europe’s over-zealous regulation – and there’s no doubt we do an awful lot. It might have taken long years of defragmenting regional and national activities, but it seems we’ve finally managed to create a stable European platform.