The Great European Biopharma Bottleneck: Capital Starved and Talent Stifled

European biopharma is a maddening paradox. It has the academic firepower to generate groundbreaking discoveries but lacks the financial machinery to turn them into therapies. This is not a new problem, and it’s not a small one either. Yet every time I see another promising European biotech sell out to a U.S. company or hear about pension funds refusing to take even the smallest of risks, I can’t help but feel annoyed—furiously so. It’s that frustration that drove me to start Capital for Cures. Because if no one else is going to tackle this problem, why not me?

We’ve built the scientific foundation for success, yet Europe remains a place where ideas too often wither on the vine. Venture capital is scarce. Pension funds remain allergic to risk. And European IPOs trade at steep discounts to their American counterparts. The result? Europe becomes a feeder market for U.S. and Asian companies, a talent exporter in a sector where retaining talent is critical.

But this isn’t a problem without a solution. The challenge lies in dismantling a culture of timidity and replacing it with one of boldness, ambition, and calculated risk-taking. And Capital for Cures is here to do exactly that.

Europe’s Chronic Capital Shortfall: A Problem Decades in the Making

The numbers are bleak. Between 2020 and 2022, only 13% of global biotech IPO proceeds went to Europe, while the U.S. raked in 78% (EFPIA, 2024). Venture capital, the lifeblood of innovation, paints an equally grim picture. European startups struggle to raise the funds needed to scale, while American counterparts can secure not just funding but strategic support from deep-pocketed investors.

In the world of biopharma, where innovation is expensive and time-consuming, this shortfall is a death knell. Without growth capital, early-stage companies can’t progress through the infamous “valley of death”—the perilous gap between research and commercial viability. Promising startups either stall out or sell out, often to American or Chinese firms eager to snap up European ingenuity at a discount.

It’s a vicious cycle. Without sufficient late-stage funding, there’s no reinvestment back into the ecosystem. The result? Europe stays in second gear while the U.S. and Asia race ahead.

The Pension Fund Problem: A Crisis of Timidity

The root of the problem lies in Europe’s pension funds, which collectively manage €3.1 trillion in assets (Invest Europe, 2024). If even a small fraction of this capital were allocated to venture funds targeting biopharma, Europe’s funding woes would vanish overnight. But that’s not how European pension funds operate.

Unlike their American counterparts—who willingly embrace high-risk, high-reward investments in sectors like biotech—European pension funds remain fixated on low-yield “safe” assets like government bonds. The excuses are predictable: regulatory constraints, cultural caution, and an unwillingness to embrace the risk-reward dynamics that drive innovation.

This reluctance to take calculated risks is costly. While U.S. pension funds reap exponential returns from biotech-heavy portfolios, their European peers limp along, chasing yield in stagnating bonds. The irony is tragic: Europe excels at creating intellectual property but fails to invest in its future.

Why This Matters: Time is Not on Our Side

In biopharma, delays are more than just inconvenient—they’re catastrophic. Developing a drug takes years, often decades, and every wasted month eats into a company’s patent life. The clock starts ticking the moment a discovery is filed, and the inability to secure growth capital accelerates the erosion of potential returns.

The broader consequences are even worse. A lack of funding means fewer European companies reach maturity. Talented researchers migrate to the U.S., lured by better funding and infrastructure. Patients, meanwhile, are left waiting for therapies that sufficient capital could deliver faster. Europe’s hesitancy to fund its biopharma sector isn’t just an economic problem; it’s a moral failure.

Shifting Away from Timidity: The Problem with the “Grant Mindset”

Part of the issue lies in what I call the grant mindset, pervasive in Europe’s research culture. Scientists and researchers, accustomed to public funding, often see their work as an academic exercise rather than a commercial venture. This mindset stifles ambition and innovation. Public money rewards incremental progress, not bold bets. And while this approach works for basic science, it fails spectacularly when it comes to commercializing life-saving therapies.

In the U.S., the mentality is different. Researchers often think like entrepreneurs. They’re not just seeking grants—they’re seeking scale. This isn’t about abandoning the pursuit of pure science; it’s about recognizing that scaling breakthroughs is as important as discovering them. Europe desperately needs to shift this mindset, teaching scientists to think beyond the lab and embrace the challenges of commercialization.

How Capital for Cures Tackles These Challenges

When I started Capital for Cures, it was born out of sheer annoyance at how Europe’s biopharma ecosystem consistently fails to live up to its potential. But annoyance is a powerful motivator, and Capital for Cures is designed to channel that frustration into actionable solutions. Our mission is simple: fix the funding pipeline, foster bold thinking, and help Europe reclaim its place as a global leader in healthcare innovation.

Here’s how we’re doing it:

1. Engaging Pension Funds: We’re working with policymakers and fund managers to create frameworks that make biopharma VC investments more attractive. Even a 1% allocation could transform the sector.
2. Bridging the Public-Private Gap: Public money should de-risk private investment, not replace it. By aligning incentives, we can attract the private capital needed for growth.
3. Shifting the Mindset: Through workshops, partnerships, and thought leadership, we aim to teach researchers to think like entrepreneurs and investors to think like scientists.
4. Advocacy and Awareness: Europe’s biopharma sector isn’t just an industry—it’s a strategic asset. We’re making the case for why it deserves bold funding and ambitious policies.

Final Thoughts: A Future Worth Fighting For

Imagine a future where Europe’s biopharma sector isn’t just an academic powerhouse but a commercial one as well. Where pension funds don’t just chase “safe” returns but invest in the therapies of tomorrow. Where researchers don’t just aim for grants but aim to scale. This isn’t a pipe dream; it’s a realistic vision—if we have the courage to act.

Europe has the talent, the infrastructure, and the intellectual capital to lead. What it lacks is the funding and ambition to make it happen. With Capital for Cures, I hope to change that. Because in the words of Peter Drucker: “The best way to predict the future is to create it.”

If this resonates with you—or if you’d like to get involved—I’d love to hear from you. Drop me a line at s.gensior@slatemountains.com. Together, we can move the needle.