From JPMA Creating an Environment for Innovation that Connects with the World

The delay in the development of a vaccine for the novel coronavirus infection (COVID-19) and other factors have led to a series of concerns about Japan's ability to create innovations.

In recent years, the circumstances surrounding the pharmaceutical industry and its business model have changed dramatically, and what was once a vertically integrated business in which all stages from upstream research and development to downstream manufacturing and sales were conducted in-house has become a horizontal division of labor. Each stage has become more sophisticated and complex, and collaboration with companies that have strengths in each has progressed. In drug discovery research in particular, it has become essential to build an ecosystem with venture companies and academia.

On the other hand, Japan's ability to create innovation is weakening in international comparison, as indicated by the decline in the number of cited papers, the decrease in the number of students studying abroad, and the stagnation in the number of start-ups. Financial strength is another cause for concern. Drug discovery requires a long development period, huge amounts of capital, and a low probability of success, but Japan is lagging behind Europe and the U.S. in venture capital (VC) investment, especially in the early clinical stage. In order to break out of this situation, long-term measures are needed, such as strengthening the ecosystem, fostering innovative human resources, and creating a culture where people are not afraid of failure.