Source: EURLEX
Language: en
Format: md

EN

![](./../../../resource.html?uri=IMMC:EESC-2021-02562-AS.ENG.xhtml.EESC_2021_02562_AS_ENG_xhtml_06001.jpg)

CCMI/185

Industrial Strategy

OPINION
  
  
Consultative Commission on Industrial Change (CCMI)
  
  
Updating the new industrial strategy – Impacts on the health industrial ecosystem
  
(supplementary opinion to INT/935)

|  |  |
| --- | --- |
|  | |
|  | |
|  |  |
| Contact | [Emanuele.Guicciardi@eesc.europa.eu](mailto:Emanuele.Guicciardi@eesc.europa.eu) |
| Administrator | Emanuele GUICCIARDI |
| Document date | 05/10/2021 |

Rapporteur: Anastasis YIAPANIS

Co-rapporteur: Antonello PEZZINI

|  |  |
| --- | --- |
| Plenary Assembly decision | 26/04/2021 |
| Legal basis | Rule 37(2) of the Rules of Procedure |
|  | Supplementary opinion |
|  |  |
| Section responsible | Consultative Commission on Industrial Change (CCMI) |
| Adopted in section | 29/09/2021 |
| Adopted at plenary | DD/MM/YYYY |
| Plenary session No | … |
| Outcome of vote   (for/against/abstentions) | …/…/… |

  

1.Conclusions and recommendations

1.1The EESC firmly believes that health is at the centre of the new international geopolitical context and that it is crucial to support a strong and coordinated European healthcare ecosystem so as to contribute to the EU's industrial strategic autonomy, technological sovereignty and a better quality of life for EU citizens based on a holistic approach, with clearly established roadmaps and measurable, transparent performance indicators.

1.2Bottom-up mapping and analysis should be carried out, together with Member States and stakeholders in the sector, in order to assess the exact nature of the dependencies identified, including the risks they pose to the resilience and functioning of the industrial ecosystem and tackle vulnerabilities and shortages of strategic materials.

1.3The EESC considers that action is needed to create a stronger, fairer and more efficient and accessible healthcare ecosystem, with effective governance, appropriate diversification of sources of supply and an interoperable and interconnected digital healthcare architecture. The EU needs to find the appropriate incentives for reshoring strategic production capacities.

1.4Europe is dependent on other countries for the supply of certain raw materials. The health sector needs stronger and more diverse international supply chains in order to be ready to face future crises. The EESC welcomes the announced proposal to create a European Health Emergency Preparedness and Response Authority.

1.5The EESC underscores the need to go up a gear, including by means of synergies between the public and private sectors. Strategic foresight at Union level is desperately needed, promoting fair availability of equipment and access to the healthcare ecosystem, greater solidarity, fairness and multilateral cooperation. The EESC calls for social wellbeing to be ensured by means of easy access to high-quality and effective medicines for all EU inhabitants.

1.6The potential synergies between large companies and SMEs are not being fully exploited, seriously hampering the empowerment of SMEs and preventing the health sector from becoming an incubator of breakthrough discoveries. Investment support instruments must be effectively coordinated, with specifically dedicated calls for industrial SMEs.

1.7The EESC calls for more clarity concerning health data sharing and the use of AI, the elimination of regulatory barriers, and support for a common EU approach to the use of telemedicine services. It fully supports the deployment of the European Health Data Space, with full respect for individual rights and the protection of personal data.

1.8The health sector can contribute significantly to the EU's climate neutrality through properly designed waste management policies, new circular economy business models and increased transport infrastructure capacity.

1.9Investing in R&D is essential for the competitiveness and sustainability of the health industry. European policies must stimulate public and private investments so that they integrate social and health aspects.

1.10The EESC calls for greater engagement in the regulatory procedures regarding the development of harmonised quality and safety standards for protective equipment and medical devices. The EESC calls for clear mandates for the standardisation bodies in the technical-regulatory process.

1.11Dedicated training, re-skilling, up-skilling and lifelong learning programmes for the European health labour force are needed in order to cope with the new challenges of the Green Deal. The focus must not only be on health professionals, but also on researchers, teachers, media people and patients themselves. The EESC therefore calls for more communication at EU level about consumers'/patients' rights, with the full inclusion of the social partners and relevant civil society organisations.

1.12The EESC calls on the Commission to continue the collaboration and dialogue between stakeholders on the resilience of the pharmaceutical sector, building on existing structures under the Pharmaceutical Strategy for Europe, and to continue to develop a strong, sustainable and digital transformation of the health industrial ecosystem as outlined in the Industrial Strategy for Europe.

2.Background and introduction

2.1The COVID-19 pandemic has created an unprecedented crisis within all the EU Member States that, unlike other crises, has impacted both supply and demand, as well as society as a whole. The EU has been hit hard compared to other parts of the world and has recorded more deaths per million people than the global trend
[1](#footnote1)
. The Union has reacted adequately, in a quasi-coordinated manner. More could have been done, had the EU been more prepared as a Union for this kind of shock.

2.2The single market represents one of the most important achievements of the European Union project. Barriers still exist, arising from the unharmonised application of EU legislation within the Member States. The COVID-19 pandemic has amplified these barriers, especially showing the fragility of value chains and the increase in distribution problems. It has become clear that the EU is dependent on third countries with regard to medical products.

2.3The healthcare sector provided more than 7 million jobs in 2018
[2](#footnote2)
. The sector is an important asset for the single market, with more than 800 000 direct jobs and EUR 109.4 billion in trade surplus
[3](#footnote3)
. Medicine producers made the largest contribution in terms of R&D investments in 2019, while the European electromedical market is now worth EUR 120 billion. However, the EU invests less in comparison to our trading partners: 19.2% of industrial R&D investment in the EU goes to health innovation compared to 26.4% in the US, for example. Europe is a major hub for the global medical device industry. The medical device market in the EU accounts for one third of the global market, with around 32 000 businesses and 730 000 employees.

3.General comments

3.1Health is one of the megatrends of the future, particularly in Europe, and in the new geopolitical context, it is crucial to support the healthcare industrial ecosystem that contributes to the EU's strategic autonomy and technological sovereignty.

3.2The EESC considers that the European Commission's communication places industry, and especially healthcare, at the centre of European policies, recognising its ability to drive major changes, interpret the new needs and challenges of society and offer innovative and competitive solutions. However, the EESC calls for a more holistic approach than that taken by the Commission, which focuses mainly on industry. Policy makers have a high level of responsibility, since health is one of the basics of individual existence and undoubtedly individuals' most precious asset. The EESC therefore calls for more communication at EU level about consumers'/patients' rights, including the fundamental rights enshrined in the EU Charter of Fundamental Rights. The EU needs a strong coordinated health system.

3.3The industrial structure of the health ecosystem is an extensive construction, with some big players and a significant number of SMEs. However, the potential synergies between these two groups are not being fully exploited, seriously hampering the empowerment of SMEs. As a result, the health ecosystem is not functioning fully and is obstructed in its role of becoming an incubator of new innovative discoveries.

3.4The health industrial ecosystem needs a strong internal market, with strong production and distribution facilities. The EESC has previously stressed the importance of a "functioning, fair and efficient internal market, which, on the one hand, promotes and rewards genuine medical innovation with real added value for healthcare and, on the other, strengthens competition for fair and affordable access to medicines"
[4](#footnote4)
.

3.5There would seem to be a significant need to upgrade the integration of the single market by ensuring more effective governance, especially in the healthcare industrial sector
[5](#footnote5)
: a well-functioning single market and competition policy enables strong business dynamics, which can play an essential role in diversifying sources of supply within the EU and avoid a fragmented healthcare architecture.

3.6As the COVID-19 pandemic has shown, cross-country collaboration and solidarity improve the EU's response capacity and increase the resilience of the Union as a whole. Strategic foresight at Union level is desperately needed, especially since the pandemic has more deeply affected the sectors and value chains that have cross-border interconnections.

3.7Strategic dependencies influence the fundamental interests of the EU. They particularly concern the areas of safety and security, the health of Europeans, and the ability to access goods, services and technologies that are key to the green and digital transitions at the heart of the EU's priorities.

3.8The EESC has recommended "presenting a clear concrete and comprehensive strategy for European industry in the short, medium and long term" and urged the Commission to "draw up a concrete action plan with clear annual objectives and monitoring procedures, which provides for close collaboration with all stakeholders"
[6](#footnote6)
 while underlining how "the role of employers, entrepreneurs and private sector engagement in driving structural change are key to industrial transition"
[7](#footnote7)
.

3.9The innovative medical-pharmaceutical industry is driven by medical progress. One important issue that needs to be immediately resolved is the unaffordability or unavailability of the medicines. Social well-being must be ensured through easy access to high-quality and effective medicines for all citizens living in the EU. The UK's withdrawal from the European Union has major ramifications for medical device manufacturers.

3.10Europe's dependence on certain raw materials from only a handful of producers and countries was evident during the COVID-19 pandemic. Moreover, even green and digital technologies, often connected with the health industrial system, also depend on a range of scarce raw materials imported into Europe, with a very large proportion of the rare earth elements needed coming from a single supplier – China
[8](#footnote8)
. Strengthening and diversifying international supply chains is also vital for the development of the health industry and ensuring that the EU will be ready to face future crises like the COVID-19 pandemic. Eliminating vulnerabilities and creating a stable, predictable and resource-efficient trading environment should be the ultimate goal. The announced proposal to create a European Health Emergency Preparedness and Response Authority is welcome.

3.11Europe has been successful in its strategy of developing Public-Private Partnerships to stimulate R&D in the pharmaceutical industry, but the amounts involved are one-tenth of what is spent by the US Biomedical Advanced Research and Development Authority (BARDA).

3.12The biggest opportunities in the coming years will stem from digital health technologies. Whether we are talking about medicinal products, medical devices and procedures, or measures to prevent, diagnose or treat diseases, they are all vital for all EU citizens. The upcoming Regulation on Artificial Intelligence
[9](#footnote9)
, the legislative proposal on the European Health Data Space
[10](#footnote10)
 and standardisation will bring more clarity to health data sharing and the use of AI, eliminate regulatory barriers and support a common EU approach to the use of telemedicine services, while the Data Governance Act
[11](#footnote11)
 should be able to guarantee the sharing of health data while safeguarding the protection of personal data and preserving other human rights.

4.Specific comments

4.1The digital transformation of the health sector is a huge opportunity. Embracing the twin transition can provide further competitive advantages for the Union, in a complex and tense international environment. Particularly by investing in high-performance computing and artificial intelligence technologies, the EU can develop cutting-edge technologies, in particular predictive ones. The pandemic has demonstrated the immediate need for smart health services, such as telehealth.

4.2Moreover, the health sector can contribute significantly to the EU's climate neutrality by reducing its greenhouse gas emissions along the value chains. Waste management policies need to be strengthened, as the sector produces significant amounts of waste from leftover medicines and used technological and personal equipment. New circular economy business models and increased transport infrastructure capacities must be developed, while engaging all Member States and stakeholders in decarbonising value chains.

4.3Human health ultimately depends upon ecosystem products and services (such as availability of fresh water, food and fuel sources) which are requisite for good human health and productive livelihoods. Biodiversity loss can have significant direct human health impacts if ecosystem services are no longer adequate to meet social needs.

4.4Traditional medicine continue to play an essential role in health care, especially in primary health care. Medicinal plant use is the most common medication tool in traditional medicine and complementary medicine worldwide. Many communities rely on natural products collected from ecosystems for medicinal and cultural purposes, in addition to food.

4.5Strategic stockpiling and reshoring EU companies are other important directions to be considered and are part of the EU's shared competences. As technology improves, and manufacturing capacity with it, the EU needs to find the appropriate incentives for reshoring strategic production capacities on its soil. Tax incentives can play a key role in this regard.

4.6Bottom-up mapping and analysis with Member States and industry is needed to make it possible to assess the exact nature of the identified dependencies in more detail, including the risks they pose to the resilience and functioning of industrial ecosystems in the EU, as well as the possible prospects for reducing these dependencies, as well as trade disputes and cyberattacks, in future.

4.7Investing in R&D is essential for the competitiveness and sustainability of the health industry. In addition to the contribution of EU funds, European policies must stimulate public and private investment as much as possible. The development of Public-Private Partnerships, like IMI2, will encourage producers to invest in and pursue R&D&I activities that are vital for future medicinal discoveries. These kinds of initiatives have the power to maintain Europe at the forefront of medical innovation.

4.8Equally, it is of the utmost importance to support Member States' efforts to pool public resources through major projects of common European interest (IPCEI) in sectors where the market alone cannot deliver breakthrough innovations, as is the case in the pharmaceutical sector.

4.9The competitiveness of the industry must be supported by a strong intellectual property rights framework that empowers and protects innovation. Access to data is also vital for the producers, especially for SMEs that have been hit hard by the pandemic and must be encouraged to scale up and grow. The EU needs specially designed policies for big data analysis and interoperable data access infrastructure.

4.10SMEs need also easy access to financing in order to prosper and grow. This also means alternative sources to the usual bank loans, such as private equity or venture capital financing opportunities. Investment support instruments must be effectively coordinated, with lines specifically dedicated to industrial SMEs. In this area, it is important for the initiatives arising from the EU's sustainable finance framework, including the implementation of the taxonomy, to be designed to provide an opportunity for the European economy, taking into account both the needs of the financial markets and the challenges of industry.

4.11The development of a European electronic health record exchange format to unblock the flow of health data across borders provides a framework for the further development of common technical specifications for the secure sharing of health data between EU Member States, on which the European Committee for Standardization is currently developing technical specifications. The EESC calls for greater engagement and inclusion of relevant stakeholders in the regulatory procedures regarding the development of harmonised quality and safety standards for personal protective equipment and medical devices.

4.12The Recovery and Resilience Facility can be used to address many of the health ecosystem's needs via investment in and reforms to national health systems, strengthening resilience and crisis preparedness, primary care, increasing fair and transparent access to services, addressing supply chain vulnerabilities and the digital skills of healthcare workers, telemedicine solutions, and research, development and innovation.

4.13The EESC calls for the development of specially designed programmes for training, re-skilling, up-skilling and lifelong learning for the European health labour force, in line with their key professional and social role, technological progress and the new requirements for enhanced sustainability. Clear training policies led by the sector stakeholders are needed in order to have qualified workers who are able to cope with the new challenges of the Green Deal.

4.14The EESC has previously noted that "new policies on skills should be designed with the involvement of civil society organisations and the social partners in order to speed up the adaptation of education and training systems to match the demand for new jobs"
[12](#footnote12)
. In the health sector, the focus must not only be on health professionals, but also on researchers, teachers, decision makers of all kinds, media people, patients themselves and their representative organisations.

4.15Strategic Public Procurement plays a key role in bringing EU industry, research centres, and EU and national regulatory authorities together, particularly in the health sector, and facilitates public-private cooperation with a view to addressing the needs of public and private health systems and enabling the purchase of innovative and affordable health technologies, including green and digital solutions and social clauses
[13](#footnote13)
. 

4.16The EESC has already called on the EU institutions and the Member States to demonstrate the political will to implement a "Health Pact for the Future of Europe"
[14](#footnote14)
 that reflects the fundamental values of the EU.

4.17The Structured Dialogue Initiative
[15](#footnote15)
 announced in the pharmaceutical strategy is vital for Europe, in order to identify the causes and drivers of potential vulnerabilities and dependencies of medicines supply chains.

4.18The EESC fully supports the deployment of the European Health Data Space
[16](#footnote16)
 in order to provide the necessary data sharing infrastructure for diagnostic tools and treatment when it comes to cooperating and engaging in efforts to co-invest in next generation healthcare ecosystems across the entirety of value chains.

4.19The EESC believes that harmonised standards should be used as an instrument to cover essential product safety requirements supported by instruments that help place the products on the market. The European Union must avoid over-regulation of products, the priority being to lighten the administrative burden caused by excessive legislation, while ensuring easy access to documentation, sound information, smooth exchange of best practices, and effective cooperation.

4.20Finally, the EESC calls on the Commission to continue the collaboration and dialogue between all stakeholders to strengthen the resilience of the EU pharmaceutical system to future crises, building on existing mechanisms set out in the Pharmaceutical Strategy for Europe
[17](#footnote17)
 and the Industrial Strategy for Europe
[18](#footnote18)
. The EESC also calls on the Commission to create further synergies between Member States, to put forward new initiatives to strengthen the coordination of the different national systems (in line with the TFEU
[19](#footnote19)
) and to continue to develop a strong, sustainable and digital transformation of the health industrial ecosystem.

Brussels, 29 September 2021

Pietro Francesco De Lotto
  
President of the Consultative Commission on Industrial Change

\_\_\_\_\_\_\_\_\_\_\_\_\_

:   [(1)](#footnoteref1)
     
       
    [EP study – Impacts of the COVID-19 pandemic on EU industries](https://www.europarl.europa.eu/RegData/etudes/STUD/2021/662903/IPOL_STU(2021)662903_EN.pdf)
:   [(2)](#footnoteref2)
     
       
    [Eurostat – Healthcare personnel statistics](https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Healthcare_personnel_statistics_-_nursing_and_caring_professionals)
:   [(3)](#footnoteref3)
     
       
    [International trade in goods by type of good](https://ec.europa.eu/eurostat/statistics-explained/index.php?title=International_trade_in_goods_by_type_of_good)
:   [(4)](#footnoteref4)
     
       
    [EESC opinion on Pharmaceutical strategy](https://www.eesc.europa.eu/en/our-work/opinions-information-reports/opinions/pharmaceutical-strategy)
:   [(5)](#footnoteref5)
     
       
    [Questions and Answers: EU4Health Programme 2021-27](https://ec.europa.eu/commission/presscorner/detail/en/QANDA_21_1345)
:   [(6)](#footnoteref6)
       
    [OJ C 364, 28.10.2020, p. 108 – EESC opinion on A New Industrial Strategy for Europe](https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52020AE1112&from=EN)
:   [(7)](#footnoteref7)
     
       
    [OJ C 56, 16.2.2021, p. 10 – EESC opinion on Industrial transition towards a green and digital European economy](https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52020AE3642&rid=2)
:   [(8)](#footnoteref8)
     
       E.g. platinum to produce clean hydrogen, metallic silicon for solar panels, and lithium for electric cars
:   [(9)](#footnoteref9)
     
       
    [Proposal for a Regulation of the European Parliament and of the Council laying down harmonised rules on artificial intelligence and amending certain Union legislative acts (COM(2021) 206 final)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELLAR%3Ae0649735-a372-11eb-9585-01aa75ed71a1)
:   [(10)](#footnoteref10)
     
       
    [Communication on A European strategy for data (COM(2020) 66 final)](https://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1582551099377&uri=CELEX%3A52020DC0066)
:   [(11)](#footnoteref11)

     
       
    [Proposal for a Regulation on European data governance (Data Governance Act) (COM(2020) 767 final)](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A52020PC0767)
:   [(12)](#footnoteref12)
     
       
    [OJ C 364, 28.10.2020, p. 108 – EESC opinion on A New Industrial Strategy for Europe](https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52020AE1112&from=EN)
:   [(13)](#footnoteref13)
     
       OJ C 237, 18.06.2021 – Buying Social – A guide to taking account of social considerations in public procurement – Second edition
:   [(14)](#footnoteref14)
     
       
    [OJ C 429, 11.12.2020, p. 251 – EESC opinion on the establishment of a Programme for the Union's action in the field of health for the period 2021-2027](https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52020AE2821&from=EN)
:   [(15)](#footnoteref15)
       
    [Structured dialogue on security of medicines supply](https://ec.europa.eu/health/human-use/strategy/dialogue_medicines-supply_en)
:   [(16)](#footnoteref16)
       
    [Commission publishes open public consultation on the European Health Data Space](https://ec.europa.eu/commission/presscorner/detail/en/ip_21_2083)
:   [(17)](#footnoteref17)
     
       https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52020DC0761
:   [(18)](#footnoteref18)
     
       https://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1593086905382&uri=CELEX:52020DC0102
:   [(19)](#footnoteref19)
     
       Treaty on the Functioning of the European Union

[Top](#document1)