In recent years, Europe has become increasingly aware of its industrial vulnerability in the life sciences sector. After decades of a gradual shift in biotech leadership toward the United States and China, the European Commission has decided to respond with a structural strategy.
The European Life Sciences Strategy, published in July 2025, represents the framework for this ambition. Within it takes shape the new EU Biotech Act, a legislative proposal expected by the end of the year, aimed at creating a more agile and competitive regulatory environment for European pharma and biotech companies.
An untapped potential
The starting point is clear: Europe excels in research but struggles to turn it into market-ready innovation. European biotechnology accounts for roughly 20% of the global value of the sector, yet the share of private investment and scale-ups remains far lower than that of major international competitors.
Fragmented regulatory markets, slow authorization processes, and limited venture capital have hindered the growth of many innovative SMEs, forcing them to seek resources overseas. This is precisely the weakness that the Biotech Act aims to address.
The Biotech Act as a paradigm shift
In the Commission’s plans, the new regulatory framework is intended to simplify development and authorization pathways for biotechnological products, facilitate the management of multi-country clinical trials, and support the creation of industrial biomanufacturing hubs.
At the same time, Brussels aims to build shared infrastructures and competencies, promoting public–private partnerships and technology-transfer platforms.
For pharmaceutical companies, this means moving from a model based on isolated scientific excellence to an integrated ecosystem where research, industry, and finance converge under a unified strategic direction. Not deregulation, but regulatory and industrial sustainability.
Manufacturing and reshoring as a strategic lever
On the industrial front, the Biotech Act could encourage the reshoring of high-value production segments. Declining energy costs and growing attention to supply-chain security make the return of critical manufacturing to Europe increasingly feasible.
However, without coordination among Member States and targeted incentives for SMEs, the risk is that this advantage remains theoretical. Large multinationals will be able to adapt quickly; smaller companies will need financial tools and stable partnerships to sustain the transition.
A New Governance of Regulation
The Biotech Act also aims to reduce fragmentation among national regulations on biosafety, data, and ethical assessments.
The introduction of regulatory sandboxes—dedicated spaces for regulatory experimentation—will allow new evaluation models to be tested in direct dialogue with the competent authorities. It is an unprecedented approach for the EU, which acknowledges that procedural rigidity can slow competitiveness in a global context where speed is an integral part of innovation.
Italy between opportunity and the risk of innovation flight
For Italy—currently one of Europe’s main pharmaceutical manufacturing hubs but still marginal in biotech—the challenge is twofold.
The country must strengthen the link between public research and industry, enhance its centers of excellence, and create fiscal and infrastructural conditions capable of keeping innovative projects within its borders.
Without a coherent national strategy, the risk is a new “innovation flight,” with start-ups founded in Italy relocating their headquarters and patents abroad to access capital and faster regulatory pathways.
The Role of SMEs and enabling technologies
Italian SMEs can play a leading role in this new landscape if they invest in digitalization and enabling technologies such as artificial intelligence, integrated clinical data, and advanced manufacturing.
To compete in upcoming European calls, it will be necessary to boost managerial capabilities and build networks for international collaboration. Large companies, for their part, will need to evolve toward more dynamic open-innovation models capable of integrating local expertise and emerging biotech partners.
Speed and concreteness: the two conditions for success
The success of the Biotech Act will depend on how quickly tax incentives, dedicated funds, and administrative simplifications are activated.
The time window is narrow: by 2030, the global life sciences market could double in value, but only the most efficient regulatory systems will be in a position to seize its benefits.
Europe cannot afford another missed opportunity. For Italy, this is the moment to decide whether to be part of the driving force—or remain a spectator of a transformation already underway.
A test of Industrial Maturity
The Biotech Act is not merely a regulatory reform: it is a test of maturity for the European system.
It will measure the ability of institutions and companies to collaborate within an ecosystem that unites innovation, sustainability, and competitiveness.
For Italy, this is the moment to shift from manufacturing excellence to leadership in innovation. The game has already begun—and its outcome hinges on how quickly we are able to interpret the future.
