Impact of Horizon Europe on growth of companies in the BioRegion of Catalonia

As we are moving into the final two years of Horizon Europe (HEU), it is time to take stock, provisionally, of how its support for companies in the sector has impacted innovation in Catalonia and to understand the challenges and opportunities still ahead. HEU kicked off in 2021 as the biggest European program for research and innovation, with a €100 billion budget, and has been key in driving strategic sectors in Europe, including the life sciences and healthcare sector. In Catalonia, the program has become a priority source of funding for the healthcare innovation ecosystem, strengthening the BioRegion of Catalonia and contributing to its leadership in disruptive projects and companies.

Horizon Europe context and future challenges

From the beginning, HEU has been structured to address large scale global challenges, particularly the healthcare crisis triggered by COVID-19, and has incorporated Next Generation funds to encourage sustainable, resilient recovery. Plus, the New European Innovation Agenda (NEIA) set new priorities in deep tech (talent, experimentation, policies, cohesion). On top of these, there is the sustainable innovation and digital and green transitions laid out in Digital Europe and the Green Deal, with its industrial version.

Nevertheless, the competitiveness gap with other global regions, and ongoing geopolitical situations, led Mario Draghi, former president of the European Central Bank and prime minister of Italy, to present a report titled “The future of European competitiveness”, which among other issues discusses the program’s efficacy and poses a radical shift in the European Union’s economic policies. In this over 400-page document, Draghi exposes several structural weaknesses:

• Fragmented priorities: too many areas competing for limited funding, making a cohesive strategy difficult.  
• Administrative complexity: applying for and managing funds is still a barrier for many organizations, especially SMEs.  
• Scarce support for disruptive innovation: despite the efforts of the European Innovation Council (EIC), many transformative technologies are fighting to get enough funding.  
• Insufficient public-private partnership: lack of clear incentives to bring the private sector into European consortia.

With these issues in mind, the final phase of the program is considering implementing changes to increase its impact and ensure better return for the stakeholders involved. One of these is the Strategic Technologies for Europe Platform (STEP), with new funding opportunities and a new STEP seal. STEP will fund development and manufacturing of critical technologies to strengthen their value chains. One of these is biotechnology. 

And we can’t forget that the European Commission highlighted the crucial role biotech and biomanufacturing play in European competitiveness this past March. The STEP seal allows projects from five European funding programs (Digital Europe, European Defense Fund, EU4Health, Horizon Europe and Innovation Fund) to have easier access to funds through ERDF and the European Social Fund. 

In recent years, the trend has been towards complementary funds to ensure funding for proposals with the greatest impact. These STEP projects can draw investors’ interest, as they have already been screened several times and secured complementary funding from several sources. 
 

Horizon Europe’s impact on the healthcare innovation ecosystem in Catalonia

In Catalonia, of the 5,439 projects identified by the RIS3-MCAT Platform that include Catalan organizations under programs like Horizon 2020, Horizon Europe and other RIS3CAT instruments, 1,734 are related to the life sciences and healthcare sector. In fact, in Catalonia, the social and health care system category has the second most projects funded with competitive European funds (32% of the total), only behind the energy and resource system. 

Filtering the projects by area (social and health care system), programs (Horizon Europe) and type of organization (companies), over a hundred projects with Catalan participants have secured roughly €100 million in competitive funding, collaborating with nearly a thousand international partners.   This data shows the strength and capacity of the Catalan innovation ecosystem to make the most of the opportunities available through European programs. 

If we continue looking at data from the RIS3-MCAT platform, one of the most relevant cases is Asphalion, a Catalan consultancy that specializes in scientific and regulatory affairs, which between 2021 and 2023 participated in seven European projects in advanced therapies and biomaterials, securing more than €1 million in funding. 

It is also worth noting cases like the startup Time is Brain, which has secured more than €5 million in investment from the European Innovation Council (EIC) to improve stroke management in ischemic patients. Plus, some companies have led more than one project during the Horizon Europe (HEU) period, like Gate2Brain and InBrain Neuroelectrics, which have headed up two projects each with a joint total of €7.5 million. These projects, funded by programs like the EIC, European Innovation Ecosystem (EIE) and the Marie Skłodowska-Curie Actions (MSCA), promote disruptive solutions to treat rare and neurological diseases.

Focusing on the investment secured by healthcare startups and scaleups in Catalonia, the 2023 BioRegion of Catalonia Report highlights a significant increase in competitive funds, mainly from the European Commission, which in 2023 was double the average for 2019-2021. In fact, healthcare companies in Catalonia got more competitive funding in 2023 than any other year, nearly €61 million, which is 28% of all the funding secured.

ABLE Human Motion led the ranking of competitive funding for the past 5 years (2019-2023), with €26.3 million in total. They are followed by Oryzon Genomics and Integra Therapeutics with €16.2 each and MiWendo with €14.1 million. 

These “Important Projects of Common Interest” to the EU and Member States are large scale initiatives that require significant investment and collaboration among several Member States, and are designed to tackle important challenges and promote innovation and economic growth in Europe. The Med4Cure category, for the European biomanufacturing sector, includes noteworthy Catalan companies like Reig Jofré, Oryzon Genomics, Mynorix and Medichem. 

Biocat’s role: catalyst for innovation

Biocat, as the driving force behind the BioRegion of Catalonia, has also made a significant contribution to securing funds and support from European projects. In total, the organization has promoted initiatives valued at €25 million, as well as the PRECISEU project, a Regional Innovation Valley in personalized medicine with an additional  €22 million. With the cascade funding expected for this project, and other previous initiatives like BioMan4R2, the organization has provided roughly €5 million in direct funding for Catalan companies.

So, to sum up, with changes potentially on the way and an ongoing commitment to excellence, the past two years of Horizon Europe may be decisive in consolidating Catalonia as a European benchmark in the life sciences and healthcare innovation. 

2027: beyond Horizon Europe

It isn’t clear whether the tenth Framework Program (FP10, Horizon) will follow the same structure as H2020 and HEU. The European Commission has proposed merging all the research and innovation funds, including the European Research Council (ERC, pillar 1 of the current HEU) and the European Innovation Council (EIC, pillar 3), into a new Competitiveness Fund that will be launched under the multiannual budget starting in 2028. Ursula von der Leyen, president of the European Commission, included this idea in her political guidelines in July. 

This fund will be used to drive strategic technologies like artificial intelligence, aerospace technologies, cleantech and biotechnology, in order to produce them in Europe and bolster the European Union’s strategic autonomy. A clear warning for companies: Europe is firmly committed to strengthening its industry.

This is how a dozen research and innovation programs would be bundled into the European Competitiveness Fund, in order to concentrate and streamline the EU’s efforts to revitalize innovation, productivity and economic growth. These programs include Horizon Europe Pillar I (including ERC), Horizon Europe Pillar III (EIC, EIE, EIT), European Defense Fund, Innovation Fund, EU4HEALTH, Space, Digital Europe, Invest EU and Single Market Program. This is Von der Leyen’s response to Draghi. 

Nevertheless, now it is time for negotiations, which may dilute the proposal. It has seen strong opposition from European regions, among others, as they see it as a centralization of European funds towards the Member States. We’ll be keeping a close eye on any developments. For now, however, some texts have been leaked from the new program 2025-2027, where companies and organizations in the BioRegion of Catalonia can explore new opportunities to secure funds for their projects.