Pharma Giants Warn EU of Investment Exodus to the U.S.

European pharmaceutical companies have issued a stark warning to European Commission President Ursula von der Leyen about a potential exodus to the United States.

The European Federation of Pharmaceutical Industries and Associations (EFPIA), representing major firms like Bayer, AstraZeneca, and Novartis, highlighted the growing challenges of operating in Europe during a recent meeting.

The industry fears that looming U.S. tariffs, coupled with existing disadvantages, could further erode Europe’s competitiveness. The EFPIA pointed out that the U.S. already surpasses Europe in key areas such as access to capital, intellectual property protections, regulatory efficiency, and innovation rewards.

These factors have made the U.S. an increasingly attractive destination for pharmaceutical investment. A survey of 18 international companies revealed that 85% of capital investments and half of R&D spending in Europe are at risk, equating to €103.2 billion ($112.9 billion).

Europe’s share of global pharmaceutical sales has declined significantly, now accounting for just 22.7%, compared to North America’s 53.3%. Between 2018 and 2023, only 15.8% of new medicines were launched in Europe, while 67.1% debuted in the U.S., underscoring the region’s waning influence.

The EFPIA has called for urgent policy reforms to reverse this trend, including stronger intellectual property protections and harmonized regulations across environmental and chemical laws. Without action, Europe risks losing its position as a global leader in pharmaceutical innovation.

While pharmaceuticals remain excluded from current U.S. tariffs, the industry fears this could change soon. Any shift would disrupt supply chains and further incentivize companies to relocate operations to the U.S., potentially reshaping the global pharmaceutical landscape.

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