Jäger: U.S. can’t win by copying Europe’s failures
In a thought-provoking article, Michael Jäger, the secretary general of the European Economic Senate, addresses the common American sentiment of envy towards European healthcare systems, particularly their government-controlled pricing of medicines. While these systems are often viewed as models of efficiency and accessibility, Jäger warns that the reality is far more complex and fraught with challenges. He highlights that Europe’s stringent price controls, while intended to make healthcare more affordable, have led to a significant decline in pharmaceutical innovation, slower access to new treatments, and a stark reduction in research investment. The consequences of these policies are evident in the UK, where major pharmaceutical companies like AstraZeneca and Merck have either canceled or postponed significant investments, signaling a retreat from a once-thriving biopharmaceutical landscape.
Jäger further emphasizes that the ramifications of implementing similar price controls in the United States could be catastrophic. He cites independent analysis from the University of Chicago, which predicts that U.S. pharmaceutical R&D investment could plummet by up to 60% if the country adopts a “Most Favored Nation” pricing model that aligns U.S. drug prices with artificially low European levels. This shift could result in hundreds of vital medicines never reaching patients, leading to longer wait times and fewer treatment options. Moreover, the article underscores a pressing national security concern: as the West potentially stifles its own scientific innovation, countries like China are rapidly advancing in biotechnology, positioning themselves as future leaders in drug development. With over 100 biotech research parks and a burgeoning market value, China’s ascent could create a dangerous dependency for the U.S. in times of health crises.
Ultimately, Jäger’s message is clear: the experience of Europe serves as a cautionary tale for American policymakers. The choice between fostering innovation and imposing price controls is stark; attempting to achieve both could jeopardize the very advancements that have historically positioned the U.S. as a leader in medical research. As the landscape of global healthcare continues to evolve, the stakes for American patients and national security have never been higher. The article calls for a critical reflection on the implications of healthcare policies, urging a balance that prioritizes innovation while ensuring access to essential treatments.
I often hear Americans say they envy Europe’s healthcare systems. As someone who has lived under those systems my entire life, I can tell you: envy is misplaced. Europe’s experience with government price controls on medicines should serve as a warning, not an inspiration.
Across Europe, governments dictate what companies can charge for medicines. It’s a policy rooted in good intentions, but has produced disastrous outcomes: fewer new treatments, slower access to new drugs, and a steep decline in research investment.
The United Kingdom, once a powerhouse of biopharmaceutical innovation, now finds its laboratories shuttered and investments fleeing abroad. AstraZeneca canceled a $600 million expansion. Merck scrapped a billion-dollar research hub in London. Sanofi has frozen substantial research and development investment until the “commercial environment” improves.
Why are the world’s leading biopharmaceutical innovators making their own Brexit?
When governments decide what a drug is “worth,” innovation withers, and over time, entire sectors of medical research migrate elsewhere. For decades, that “elsewhere” has been the United States, the primary market that still rewards discovery and risk-taking.
If America enacts “Most Favored Nation” price controls, tying U.S. drug prices to the artificially low levels set by European health ministries, it risks erasing that advantage overnight.
Independent analysis from the University of Chicago shows that such a move could cut pharmaceutical R&D investment by up to 60%, resulting in hundreds of medicines never reaching patients. America’s Congressional Budget Office has warned the same: price controls lead inevitably to fewer cures.
For patients, that means longer waits, fewer options and vanished hope. For the US, the consequences would extend even further.
Europe’s retreat from biomedical innovation did not occur in a vacuum, and neither would America’s. As the West throttles its science, China is racing ahead.
Beijing has declared biotechnology a “strategic emerging industry.” It now hosts more than 100 biotech research parks and 17 industrial clusters, and its firms have gained $300 billion in market value in just a few years.
In a future pandemic or biothreat, dependence on China for critical drugs and vaccine components would be more than an economic liability; it would be a strategic vulnerability. Innovation is just as much a moral imperative for patients as it is a pillar of national security.
Europe has lived this experiment, and the results are in: price controls shrink access, slow cures and surrender scientific leadership to nations willing to invest.
Europe’s lesson for American policymakers is simple: You can have innovation, or you can have price controls, but you cannot have both. If America forgets that, it will find itself asking others for the cures it once created.
Michael Jäger is the secretary general of the European Economic Senate/InsideSources
