The European Commission and others have recommitted to keeping its pharma sector on the cutting edge of research and technology, agreeing to pump €3.45 billion ($4.4 billion) into programs focused on innovative treatments over the next 10 years. The projects are expected to focus on advancing new antibiotics and treatments for major health threats such as Alzheimer's disease.
The funds benefit the second phase of the Innovative Medicines Initiative (IMI), which began in 2007 and has resulted in at least 40 projects involving pharma companies, universities and others, according to the EC. The commission and EU member countries are expected to pony up €1.725 billion with industry coming up with the same for what they are calling IMI2.
Europe's pharma sector faces competition from the U.S. and emerging markets in Asia and elsewhere. The IMI program has sought to entice corporate investments in pharma work in EU countries, during a time when Europe's largest drugmakers have cut thousands of jobs on the continent and priorities shift to faster-growing markets such as China. European governments and pharma companies have also clashed over the cost and reimbursement of drugs, prompting executives to seek investments elsewhere.
The EC has targeted pharma and four other tech-driven industries as the focus of $22 billion in research spending, with the help of industry, to create badly needed jobs in EU countries.
"The EU must remain a leader in strategic global technology sectors that provide high quality jobs," José Manuel Barroso, president of the EC, said in a statement. "This innovation investment package combines public and private funding to do just that. This is a perfect demonstration of the leverage effect of the EU budget for growth and jobs."
The IMI2 program is expected to launch in January 2014 and last through 2024. The initiative will involve working closely with the European Federation of Pharmaceutical Industries and Associations, whose members include Novartis ($NVS), Sanofi ($SNY), GlaxoSmithKline ($GSK) and most of the world's largest drugmakers. With China fast on its way to becoming the world's No. 2 pharma market, it should be interesting to see where companies are investing the bulk of their budgets 10 years down the road.