Europe remains one of the world’s leading centers for scientific research, producing groundbreaking discoveries, highly skilled researchers, and innovative entrepreneurs. However, according to former Italian Prime Minister Enrico Letta, the continent continues to struggle with transforming scientific excellence into globally competitive businesses. He argues that success in today’s technology-driven economy depends not only on inventing new ideas but also on the ability to finance, test, manufacture, and rapidly scale them. Strengthening EU innovation is therefore essential if Europe wants to remain competitive against major global rivals such as the United States and China.
The life sciences and biotechnology sectors clearly demonstrate this challenge. Although Europe possesses a strong scientific foundation, many companies relocate abroad to secure funding and expand their operations. The European Commission’s 2025 Biotech Act highlights this growing concern. Between 2015 and June 2025, health biotechnology start-ups in the United States attracted approximately €219 billion in venture capital, while European companies secured only about €25 billion. This significant funding gap limits Europe’s ability to commercialize scientific discoveries and build globally successful biotechnology companies, weakening long-term EU innovation and economic competitiveness.
Europe has also lost ground in clinical research. The European Economic Area’s share of global clinical trials declined from 18% in 2013 to just 9% in 2023, while China’s share increased dramatically to nearly 30%. New medical treatments frequently become available to American patients before Europeans, and even after regulatory approval within Europe, access often varies significantly among member states due to fragmented healthcare systems and national regulations. These obstacles reduce the speed at which innovations reach patients and discourage companies from investing and expanding within Europe.
Letta emphasizes that many European entrepreneurs genuinely want to build their businesses at home but often conclude that they must relocate abroad to access investment, larger markets, and stronger commercialization opportunities. This persistent “brain drain” threatens Europe’s long-term economic future by allowing talented innovators and promising companies to develop elsewhere. Without greater access to capital, integrated markets, and supportive policies, Europe risks becoming primarily a consumer of technologies developed in other regions instead of a global leader in innovation.
To address these challenges, Letta proposes introducing a “Fifth Freedom” alongside the European Union’s existing freedoms governing the movement of goods, services, people, and capital. This new freedom would promote the unrestricted movement of knowledge, research, and innovation across Europe. Under this approach, researchers, investors, manufacturers, and entrepreneurs could collaborate more effectively across national borders, allowing start-ups to access financing, talent, production facilities, and customers without leaving Europe. Such deeper integration would strengthen EU innovation by creating a more unified ecosystem for scientific commercialization and industrial growth.
The health sector illustrates both Europe’s greatest strengths and its largest missed opportunities. Europe possesses extensive public health systems, world-class universities, and vast amounts of valuable medical knowledge. If these assets were better connected through coordinated investment, research collaboration, and cross-border commercialization, Europe could become a global leader in biotechnology and advanced medicine. Achieving this goal requires greater political commitment, stronger financial support, and policies that encourage innovation to grow across the entire continent rather than within isolated national markets.
Ultimately, Letta argues that Europe already has the scientific talent needed to succeed but lacks the integrated economic environment required to transform discoveries into globally competitive businesses. The proposed Fifth Freedom seeks to remove barriers that prevent companies from scaling efficiently across Europe. By improving investment opportunities, strengthening collaboration, and creating a unified innovation ecosystem, EU innovation could enable future European biotechnology companies to develop, expand, and deliver new treatments to patients without needing to relocate outside the continent.