- January 10, 2021
- Posted by: EBAN Team
- Category: News
Life science is one of Sweden’s most important sectors and a growing market both in Sweden and globally. Interest in investing in the life sciences is strong and in recent years, tech investors have also shown great interest in life science-related diagnostics, medical technology, and analytical tools.
Read on for a summary of trends from EBAN member Sciety that make it particularly interesting to focus on Swedish growth companies in the life science and digital health sectors.
Demographic trends create increased demand
The need for care is growing as a result of demographic changes, with increased life expectancy and reduced childbearing, especially in Europe, the US, and Japan, while the proportion of people of working age has declined. For example, the percentage of people over the age of 80 in Europe is expected to double between 2016 and 2050. This demographic trend leads to an increased need for medications, innovative medical devices, and digital solutions.
The biotechnological revolution creates new opportunities in technology and medicine
The growing knowledge base related to biology and the underlying heterogeneity of diseases creates new opportunities for developing treatments tailored for each case, known as precision medicine. The strong interest in precision medicine in turn strengthens the demand for precision diagnostics and technology solutions in fields such as genomics, high-throughput screening, and informatics. Swelife, one of Sweden’s strategic innovation programs, has focused on precision medicine as a priority area and identified Swedish companies as promising in this field.
Growth companies are more innovative
Several indicators suggest that the level of innovation is greater in small growth companies than in large pharmaceutical companies. In 2018, biopharma growth companies were responsible for the discovery of 64% of all new drugs that ultimately gained FDA approval. The trend is also for small companies to pursue clinical development closer to market approval under their own management, which builds greater value before a potential sale of the company or out-licensing. The major pharmaceutical companies are increasingly entering into partnerships with academic centers and small companies, thereby creating good exit opportunities for small companies.
Virtual business models and regulatory flexibility
Pharmaceutical companies no longer need complex organizations with large laboratories. There is a clear trend toward the creation of “virtual” companies that outsource large parts of their preclinical and clinical work, which can result in major cost savings.
Regulatory authorities are also becoming more flexible with respect to study design in order to offer a more efficient path to market approval for new medical products. For example, in oncology, the FDA permits one continuous clinical trial to be conducted instead of the traditional sequential three phases, which can potentially save both time and money so that new drugs can reach the market more quickly.
Leading life science clusters and unique position to commercialize new discoveries
Sweden has several prominent life science clusters, where most successful companies began as startups based on academic research. In a few years, Hagastaden in Stockholm will be completed, with the vision of being a world-leading life science cluster.
The “teacher exemption” in Sweden also creates a relatively unique position among university researchers, who own the right to their discoveries, thereby providing an incentive to conduct research in Sweden while simultaneously commercializing the discoveries.
Digital solutions implemented at a rapid pace
Digital health solutions are being implemented at a rapid pace and the global digital health market is expected to increase fivefold between 2019 and 2026. The trend is driven by growing support for digital solutions from public decision-making bodies around the world, as well as greater use of data analysis in healthcare. The underlying driving forces include the opportunity to cut costs, improve quality of care, and streamline healthcare workflows. Healthcare consumers are also becoming more demanding with respect to their care and increasingly prefer digital tools and solutions that facilitate on-demand care instead of physical encounters.