This letter has been co-authored by Novartis and Eurasia Group
Life sciences innovation in advanced economies is under threat—not from a lack of talent, ideas, or scientific leadership, but from policy failures. The EU, Canada, Japan, and other major markets are losing ground to the US and China on investment, clinical trials, and first launches despite having world-class universities, hospitals, R&D centers, and biotech expertise.
The culprits are slow, fragmented regulation; unpredictable pricing; reimbursement decisions that penalize innovation; and blunt cost-control instruments such as budget caps and claw backs. Together, these policies signal to researchers and investors that innovation will not be reliably rewarded.
In a G-Zero world of transactional geopolitics, such policies are strategically self-defeating. The Covid-19 pandemic proved that life sciences drive economic competitiveness, health security, and geopolitical leverage. They also provide access to critical medicines, vital health data, and cutting-edge technologies that turn vulnerability into resilience. Advanced economies that neglect these areas risk falling behind.
This trajectory is not inevitable. As global trade and supply chains are rewired, states that act quickly can still establish themselves as critical life sciences hubs. Doing so requires a deliberate shift from defensive, cost-containment politics toward urgent structural reform. The alternative is stark: without decisive action, innovation gaps will widen, access to healthcare will decline, and geopolitical standing will erode.