When school’s out for summer EARLY!
It was rowdy, boisterous and entertaining, and almost an embodiment of the Alice Cooper hit ‘School’s out for Summer’. But what would you expect from a cross-party parliamentary Health Commission group which descended on the event ‘Bridging the Atlantic: Boosting Investment and Innovation in Portugal’s Health and Biotech Industry’ organised by the American Chamber of Commerce in Portugal (AmCham) in October.
I don’t think I’ve ever seen anything like it! For a minute I thought I was before an undisciplined secondary school class where the teacher was having a tough time controlling his pupils.
But no, this was a group of Portuguese parliamentarians who simply brought the chaotic heckling and noisy talking while speakers were trying to get a word in edgeways to a normally sedate, calm and businesslike environment of an American Chamber of Commerce lunch held at the Hyatt Regency Lisboa Hotel in Lisbon on 22 October.
The heated discussion was bi-lateral investment in both Portugal’s and the United State’s of America’s private healthcare sectors, particularly in the area of biotechnology, an area in which Portugal excels.
Focused mainly on health and biotechnology, this event aimed to foster an open discussion on identifying opportunities for collaboration between Portugal and the US, to look at how technology transfer and innovation between the US and Portugal can be facilitated, and how American companies can contribute to digital transformation in Portugal, to increase competitiveness and economic development, and discuss incentives and policies to attract and retain overseas investment, pin-point stumbling blocks and come up with solutions.
The breakfast event also discussed the overall business environment in Portugal, including legal, financial and cultural aspects, among others.
In the first panel, (the rowdy one) a number of salient points were made by Ana Abrunhosa who said that the Golden Visas should focus on attracting investment in science and culture while pointing out that investing in healthcare and innovation in health was extremely expensive, and since it would benefit society as a whole, so it would make more sense to channel EU funds into the sector.
Ana Abrunhosa (Independent MP) also stressed that there needed to be more research in health and to achieve that string tax incentives were needed, strategic partnerships should be created, and regulations should be dialled down since they tended to delay innovative products reaching the market.
Mário Amorim Lopes (Liberal Initiative Party MP) opined that innovation in Portugal reflected the overall innovation ecosystem in Portugal: depressing! (I’m sure that’s not a totally fair nutshell summary).
He said that Portugal purchased poorly in many areas that measured innovation. It was not only necessary to change public policies, but also culture which, together with entrepreneurship was lacking, while the Portuguese business community needed to stop seeing business failure as a weakness, something to be ashamed of, unlike in the US where it is seen as a useful learning experience.
However, this attitude, which blocked risk-taking, went beyond business culture. There was also a problem with the amount of paperwork and time to wind up a company.
But this wasn’t a purely Portuguese illness, but affected Europe as a whole, with the rare exceptions of Denmark and Switzerland.
There was also a weak capital market in Portugal. What was interesting is that a country of a smaller size and comparable population, Israel was a more lot dynamic, with a lot more companies in the sector and attracted way more investment than Portugal. In fact, he said that Israel’s capital market was the equivalent of the whole of Europe’s, and one-third of that in the United States.
There are reasons for this: Israel has an entrepreneurial spirit and a creative, highly educated, skilled, and diverse workforce. It is a leader in innovation in a variety of sectors, and many Israeli start-ups find good partners in US companies.
Popularly known as “Start-Up Nation,” Israel invests heavily in education and scientific research and US firms account for nearly two-thirds of the more than 300 research and development (R&D) centers established by multinational companies in Israel.
Israel has 131 companies listed on the NASDAQ, the fourth most companies after the United States, Canada, and China. Israeli government agencies, led by the Israel Innovation Authority, fund incubators for early-stage technology start-ups, and Israel provides extensive support for new ideas and technologies while also seeking to develop traditional industries. Private venture capital funds have flourished in Israel in recent years. And Portugal?
“We need tax incentives and we also to ensure that the State doesn’t behave like a selector of champions, choosing which companies should lead”, he said in a nod to undue influence and bias.
Miguel Santos (PSD MP) believed that political stability was essential for stable policies and creating an attractive investment climate that instilled investor confidence.
“There seems to be a policy of flagging up the constant conflict between the private and public sectors with all the consequent problems this causes as a result,” he said.
And he said that although a 1% cut in corporation taxes in the State Budget for 2025 seemed paltry, it did at least signal a departure from the usual trend of clobbering companies with higher taxes.
“Perhaps in four years from now we can speak of an accumulated reduction of 4% which would bring significant impacts”, he said.
Miguel Guimarães (PSD MP) said that if it was up to him to choose a priority to make the sector better, it would be slashing red tape which would shorten the time between scientific discovery and its market application.
He also called for health reform based on the three ‘I’s – investment, innovation and Investigation (Research).
There was also an opportunity for Portugal regarding the US in the AI area since Portugal had a broad and well-organised range of data that could be used on digital platforms.
“The big challenge is the lack of decision-making capacity and the sluggish decision-making process in Portugal that is laughable and holds us back,” he said.
Pedro Frazão (Chega MP) touched a sore point in pointing out that for 10 years there has been an extraordinary levy on the pharmaceutical industry. (And on any others – basically a stealth tax)
“It’s unbelievable that something that should have been temporary would become permanent and it’s a big turnoff for investment and should be scrapped immediately,” he said.
By getting rid of the tax, Portugal would find it easier to attract more investment, stimulate the economy and collect more benefits.
Frazão also pointed out that in 2023 Chega (far-right party) has presented a legislative bill for the reindustrialisation of the pharmaceutical industry cluster and said that Portugal could be a paradise for clinical trials.
All in all, the event which was closed by the Secretary of State for Health, Ana Povo made a welcome and refreshing change from the usual sober soft-spoken business debates that dominate the Portuguese corporate luncheon scene. Lively, entertaining and at times downright amusing, one can only hope that more such debates can be organised by the American Chamber of Commerce in the future. Thankfully, no-one hurled bread rolls across the room!
Chris Graeme (Editor)