Painful as it is for a Remain campaigner like me to admit, the EU has always been dire when it comes to policies for supporting innovation and technology. Even more painfully, things have worsened over the past ten years. Longstanding structural weaknesses in EU innovation policy date from well before the Brexit referendum in 2016. The European Union had dismally failed to create a regulatory environment conducive to technological innovation. As I found whenever I visited to Brussels as a No. 10 adviser under David Cameron, the policy instincts of European Commission officials were overwhelmingly rooted in market stability and risk avoidance – values that, while defensible in themselves, often produced unintended consequences for fast-moving sectors such as digital technology and life sciences. Take the EU’s data privacy rules, which were debated and developed for years before being finally implemented in 2018. As Cameron’s team repeatedly warned at the time, the compliance costs fell disproportionately on small and early-stage firms. Even before fines or litigation, the administrative burden for smaller organisations typically ran into tens of thousands of pounds.

Chapter 3.9 Explains how payment mechanisms should respond to the notion of antibiotics as global public goods. Global public goods are goods and services whose benefits are universal in scope. Antimicrobial resistance (AMR) poses a major health and economic threat world-wide, making novel antibiotics a global public good. Payment mechanisms have an important part to play in encouraging crucial research and development (R&D). Key learning includes that

• The antibiotics market is broken. Despite global concerns about the failure of current antibiotics, industry struggles to develop the innovative drugs needed.

• The pharmaceuticals market is patent-centric and does not incentivize innovation. The development pipeline is dominated by redeveloped versions of classic compounds than to developing novel antibiotics.

• National and global incentive programmes are crucial in making the antibiotics market attractive to industry and in prompting the development of innovative, high-priority antibacterial drugs.

• Incentives must address barriers at different stages of the value chain, including the:

• – Scientific stage, for example by splitting the roles of the public and private sector in R&D

• – Regulatory stage, by speeding up approval processes and harmonizing approaches across countries, and

• – Economic stage, countering low commercial rewards compared to other therapeutic areas

• Drug regulatory agencies must strike a balance between rapid approval and ensuring that licensed drugs meet quality, safety, and efficacy standards.

• International coordination is key to reviving the antibiotics market and development pipeline.

This chapter describes Tencent’s development history, its transformation of corporate strategies, its core business distribution, the adjustments it has made to organisational structure, and its innovative developments in both product offerings and the technology it uses, describing how all of this happened in the context of the development of the internet industry in China over the past twenty-five years. The chapter summarises the innovation milestones of Tencent’s products and services, such as the multiple iterations of the instant messaging services QQ and WeChat, and shows how it developed its businesses through major strategic investments and venture capital in many fields. It also describes Tencent’s R&D endeavours and provides a detailed picture of its technological innovation over the past two decades. The chapter also compares Tencent’s patent applications with those of other foreign and domestic companies, showing Tencent’s leading position globally and domestically in this category.

Chapter 3.4 explores how pharmaceutical care is financed. Paying for medicines includes how the end-purchase of existing medicines is managed but also the way investment in research and development (R&D) is handled. Key learning includes that

• Pharmaceutical innovation draws on substantial public and private resources.

• – The public sector primarily supports early-stage research, regulates the industry and incentivizes development.

• – The private sector is typically central to development, commercialization, manufacture and marketing. It seeks high profit margins and is not always transparent or responsive to policy priorities.

• Novel and specialized therapeutics as well as population ageing are likely to accelerate medicines expenditures. This requires careful management of pricing and reimbursement.

• Policy-makers can leverage a mix of push and pull strategies to align industry efforts with societal need including through

• – Clear communication of health system priorities

• – Transparent incentive and pricing systems and measures to enhance R&D efficiency

• – Payment mechanisms that foster equity and sustainability

• – Cross-country collaboration including on preparedness, procurement and pricing transparency.

This chapter focuses on China’s rise as an innovation leader. It examines the key actors in China’s innovation system and highlights the prime role of the state in China’s science and technology trajectory. It also underscores the ‘innovation chain’ concept recently embraced by China’s leadership. The chapter then focuses on the key role of technology hubs and the increased participation of Chinese enterprises (especially tech firms) in the transformation of China into a technology and innovation powerhouse and the birthplace of unicorns.

This chapter explores the gap between technology’s promise and our ability to realize the global public goods of vaccines and medicines. This gap stems from significant market disincentives in the R&D process, along with clinical trial challenges and regulatory hurdles. Yet a range of innovative financing strategies to delink R&D costs from vaccine and drug prices, along with well-designed and ethically run clinical trials, can fill this gap, facilitating development of urgently needed medical countermeasures.

Income tax systems commonly contain a broad range of tax incentives. These incentives are tax expenditures as they are an indirect form of government spending designed to benefit targeted taxpayers. Based on the income tax formula, the principal ways that tax incentives may be provided are by granting special exemptions, deductions, tax offsets or reduced tax rates. This chapter examines a number of intricate tax incentive programs that have been established by the Australian Government to encourage certain forms of investment. In particular, it examines various programs that support investment in start-ups and other entrepreneurial ‘small and medium enterprises’ (‘SMEs’). These entities have the potential for rapid growth and play a key role in Australia’s innovation system. However, because of their risky nature, they often find it difficult to borrow money and need to rely heavily on equity finance. This form of finance is known as ‘venture capital’ and comes from two main sources: angel investors (ie wealthy entrepreneurs and business people) and venture capital funds (ie funds run by professional fund managers).

This chapter discusses the pharmaceutical industry, with specific attention given to the role of intellectual property and R&D. The chapter also explains (broadly) the process by which a new drug is approved by the Food and Drug Administration. The key concept in the chapter is the tradeoff inherent in intellectual property protections: stronger protections spur more innovation but at the cost of higher prices for a longer period of time. On the other hand, weaker protections allow for more affordable products more quickly, but at the cost of reduced innovation. The end of chapter supplement explores the role of international trade agreements in solving research and development coordination problems.

This chapter considers how innovation policy and health law – including food and drug regulation, healthcare reimbursement, and direct R&D subsidies – have both encouraged and impeded the development and allocation of new technologies in the fight against COVID-19. First, an expansive diagnostic testing program for COVID-19 is critical both to slow the spread of the disease and to ensure that future outbreaks can be detected early. The disastrous US testing response represents both an individual regulatory failure and a failure of coordination among agencies including the Food and Drug Administration (FDA), Centers for Disease Control (CDC), and Centers for Medicare and Medicaid Services (CMS). On the treatment side, drugmakers have rushed to identify new and existing compounds for potential COVID-19 efficacy against the backdrop of potentially lengthy and expensive clinical trials. In response, the FDA has granted Emergency Use Authorizations for several of these drugs, which requires balancing risks and harms on only minimal evidence. The intersection between incentives and regulatory oversight has profoundly shaped the innovation landscape for new COVID-19 treatments, such as by permitting widespread use in ways that do not improve the evidence base about which therapeutics are most effective. Finally, extinguishing COVID-19 will require the development of a broadly effective vaccine. This is an opportunity to develop and implement novel ex post rewards, including reimbursement incentives per vaccination to promote vaccine uptake. Each of these areas reveals important lessons to help policymakers better prepare for the next pandemic.

In the years following FDA approval of direct-to-consumer, genetic-health-risk/DTCGHR testing, millions of people in the US have sent their DNA to companies to receive personal genome health risk information without physician or other learned medical professional involvement. In Personal Genome Medicine, Michael J. Malinowski examines the ethical, legal, and social implications of this development. Drawing from the past and present of medicine in the US, Malinowski applies law, policy, public and private sector practices, and governing norms to analyze the commercial personal genome sequencing and testing sectors and to assess their impact on the future of US medicine. Written in relatable and accessible language, the book also proposes regulatory reforms for government and medical professionals that will enable technological advancements while maintaining personal and public health standards.