The Worldview national ranking of health biotech sectors

According to the writer Malcom Gladwell, “A ranking can be heterogeneous … as long as it doesn’t try to be too comprehensive. And it can be comprehensive as long as it doesn’t try to measure things that are heterogeneous. But it’s an act of real audacity when a ranking system tries to be comprehensive and heterogeneous.” In that spirit, it is probably inevitable that an attempt to rank and analyze the competitiveness of national biotech sectors across the world will be challenging.

Gladwell’s principal objection to rankings is not overreach, but the intrinsic and unstated biases of the people who compile them. “Who comes out on top, in any ranking system,” he says, “is really about who is doing the ranking.” He could have added “… and what they think is important.”

In our view, a key hurdle to a robust assessment of a national biotech sector is the lack of a national (or international) consensus definition for what constitutes biotech. For example, even in the United States, there is no federally recognized definition of biotech companies. Rob Carlson, a consultant and investor in early-stage biotech, has pointed out that the North American Industrial Classification System (NAICS), which is used by the US federal government to classify businesses, lacks any consistent definitions for biotech¹.

For the purposes of this survey, we chose to focus on biotech companies built around intensive investment in R&D. We adopt a definition of biotech that has been used for over two decades in Nature Biotechnology’s annual survey of public biotech companies. This definition focuses on R&D-intensive companies in the health biotech arena (largely because data and outcomes are readily available for health biotech companies, whereas they are not for agricultural biotech, industrial biotech or environmental biotech). As a result, any companies using biotech outside the health biotech sector (even if they are R&D intensive) are excluded from our dataset.

It should also be noted that the ‘R&D-intensive’ aspect of our definition means that our analysis excludes many companies that are ostensibly considered part of the biotech/health biotech sector: biosimilar manufacturers; large multinational corporations originating from the chemical industry (big pharma); specialty pharma; generics manufacturers; contract research organizations; contract manufacturing organizations, technical services or materials and reagent suppliers; instrument suppliers; digital health developers; and diagnostic and device manufacturers (with an exception for next-generation sequencing instruments). Furthermore, R&D spending by public biotech companies will include spending both on fundamental R&D and on clinical development.

Another important aspect of our ranking is the use of indexed data. Throughout our analysis, financial variables are normalized by national GDP; head count and other variables are related to resource number by population; variables representing change are intrinsically indexed—that is, one year’s performance is divided by performance from an earlier year. Details of the indexing used for each variable are given in Supplementary Table 3 (under the Variable heading) and the data used are shown in Supplementary Table 2. Indexing data in this way may be an oversimplification: it can be argued that larger national economies provide stronger network benefits for participants and, therefore, a firm operating in a smaller economy may be disadvantaged: in other words, ‘size does matter’. In general, we recognize the validity of such network effects. However, we believe that two considerations limit their importance in health biotech. First, at the resource level, health biotech’s networks are not restricted to national boundaries; research, capital and personnel are not restrained by national borders. Second, regardless of the national origin of innovation, the commercial market for health biotech is largely concentrated in one economy—that of the United States—where healthcare expenditure per capita is almost double that anywhere else. All firms in health biotech are playing in the same market and are subject, broadly speaking, to the same network effects. Any missed subtleties in network effects are offset by an obvious gain: the removal of the size of a country’s population or its economy as an uninteresting component of variation in the data. This allows subsequent analysis to focus on more interesting differences.

Finally, only a limited number (40) of the world’s 195 countries met the criteria for inclusion in this survey. The other 155 countries are excluded due to a lack of data for two or more essential variables in the pillars within the period in question; our analysis does not facilitate gap-filling approaches, such as multiple imputation or other missing-data methodology (see Supplementary Methods).

Previous attempts to rank national biotech or life sciences sectors have often focused on a single variable, such as academic performance² or the pursuit of economic excellence as measured by a basket of variables, including research, venture capital investments, patents and commercial activity³. Reports from consultancy firms (such as McKinsey’s Biotech in Europe: Scaling Innovation⁴) or accountancy firms (such as Ernst & Young’s Beyond Borders series⁵) also provide observational comparisons of national performance in biotech based predominantly on industry financial performance, research publication metrics and business deal data. Presented as white papers, these reports supplement internal insights based on industry snapshots with articles from industry ‘thought leaders’ that attempt to capture the biotech zeitgeist of a particular year. Although they are clearly valuable, their utility as contributors to a broader understanding is limited by the proprietary nature of the data they use and the lack of transparency about their methodology.

Here we take a different approach. It is loosely based on the approach of a previous analysis, Scientific American’s Worldview, which was published between 2008 and 2018. The Scientific American ranking defined and enumerated seven pillars of innovation-related activities (and combined 27 data sources), stretching from fundamental foundations of modern societies to assessments of intellectual property and investment, to provide a combined ‘scorecard’ that ranked national sectors. Although it had the breadth and ambition required to capture a broad and diverse enterprise like biotech, it lacked transparency with regard to the data and methodology employed to construct the ranking.

Our goal is to provide a ranking survey with a much greater degree of transparency with regards to data sources and methodology. Our analysis rests on fewer (five) pillars (Fundamentals, Education, Research & Translation, Investment and Public Biotechnology Companies) than the Scientific American analysis, but these are made up of a broader set (40 compared with 27) of data sources⁶.

We also increase the robustness of our ranking by reducing the use of ‘soft’ metrics used in the Scientific American ranking—those based on expert qualitative judgements—and increasing the proportion of ‘hard’ metrics—those based on quantitative data gathered through reporting and monitoring. In the analysis presented here, only 28% of the variables are ‘soft’ metrics, whereas 44% of those in Scientific American Worldview were soft. Supplementary Tables 4–8 present the data used in our analysis; references and links to the original sources are in Supplementary Table 3.

A detailed description of our methodology can be found in the Supplementary Methods. Input data used in calculating the ranking can be found in Supplementary Tables 4–8. The weightings for each variable are in Supplementary Table 9. In the following sections, we summarize the performance of national biotech sectors. We first highlight the various strengths and weaknesses of national sectors revealed in the ranking based on continental groupings. We then highlight key insights arising from the analysis and provide an outlook for building on the present work.

The 40 countries shown in Tables 1 and 2 represent groups of nations that have built their biotech prowess in the presence (24 countries in Table 1) or absence (16 countries in Table 2) of access to stock market funding for research-driven firms. This is an important distinction in regard to a nation’s ability to mobilize its innovative capacity. Many traditional public stock exchanges limit listings and trading to companies that are profitable or that have substantial revenues. Relatively few allow loss-making firms to list, which means the majority of biotech firms are excluded (as most remain unprofitable for up to a decade or before bringing a health biotech product to market).

Switzerland, Sweden and the United States—in that order—head our ranking, with five other European nations plus Israel and Singapore making up the top ten. The broader list of 40 countries covered in Worldview (Tables 1 and 2) contains 3 from North America, 24 from Europe, 3 from South or Central (Latin) America and 8 from Asia and Oceania. South Africa is the sole data source from Africa.

The Americas

It may come as a surprise that the United States does not place first in our ranking. This is because our analysis focusses on intensity, not size (see Discussion). The United States is a large country, likely to sweep up biotech’s gold medals based on absolute numbers of companies, products or investments. In the past 10 or 20 years, European nations with large populations, such as Germany, France and the UK, have similarly also claimed to have leading biotech sectors. However, Worldview aims not to credit any nation simply for being large or, conversely, to penalize another for being tiny. Back in 2004, this journal pointed out that Iceland, with five biotech companies employing around 600 people, rivalled California and New England in terms of the density or intensity of its biotech effort⁷.

As expected (see Supplementary Table 4), the United States scores highly in the Public Biotech Company pillar (first in absolute numbers but third, behind Switzerland and Denmark, when GDP is taken into account), the Investment pillar (second behind Israel when GDP is taken into account) and the Fundamentals pillar (fourth rank). However, it ranks only 11th in the ‘Research and Translation’ pillar and a lowly 34th in the ‘Education’ pillar (see Supplementary Table 1 and the Discussion section for more details). Using scoring systems developed by the World Economic Forum, the United States places 16th out of 40 nations surveyed in our ranking for Perceived IP Protection (Supplementary Table 6).

Canada ranks 18th among the 40 countries in our survey (Table 1), coming in at 7th in the Fundamentals pillar and mid-table within other pillars (Supplementary Table 1; Fig. 2). Our survey data confirm Canada’s strong commitment to venture investment, particularly in biotech (Supplementary Table 5), but government expenditure on R&D lags that of the United States, China and many other Asian and European nations. Like the United States, Canada’s record of research publications in life sciences is good, but the country also employs relatively few people in research and technical positions.

Ranks are shown for Public Biotech Companies, Investment, Research & Translation, Education and Fundamentals.

Mexico, Brazil, Colombia and Chile are each in the bottom half of the rankings of those nations with no qualifying public biotech sector, Mexico being the most highly ranked of the Latin American nations at 9th, Brazil in 10th, Chile in 12th and Colombia in 14th place (Table 2). The four countries are in the lowest quartile of the Fundamentals pillar ranking (Supplementary Tables 1 and 8), reflecting relatively low performance in the legal, regulatory and social spheres. Private and government investment in R&D are also relatively low in these countries: overall government investment in R&D sits at 1.26% of GDP in Brazil—less than half of the levels for the United States, Canada and other more developed nations—whereas Mexico, Chile and Columbia are lower still at 0.25–0.5% of GDP. Typically, venture capital deployment is also low in Latin American nations: in Brazil ~0.1% of GDP, Mexico ~0.05%, in Colombia ~0.03% and in Chile 0.01%. However, in our dataset, Colombia had deployed an anomalously high level of venture capital—0.37% of GDP—hoisting the country to seventh overall in that subcategory ranking (just behind China) thanks to a $1 billion investment in delivery service start-up Rappi from Softbank. Even though venture capital deployment grew considerably in all four nations—300% year-on-year for Colombia and Mexico—virtually none of it ends up in biotech (Supplementary Table 5). Notably, Mexico is training a higher proportion of STEM graduates than either the United States or Canada, and appears to be opening its educational doors to an increasing number of international students. (Note: the section below on ‘BRICS and MIKT’ deals with additional aspects of the performances of Brazil and Mexico.)

Europe

European nations feature prominently in Table 1, particularly Northern European countries and Israel (which we include in Europe because of geographical proximity and cultural history). Switzerland and Sweden top the rankings, with Denmark and the Netherlands in fifth and sixth positions overall. Switzerland is in the top ten in every category except Education, where it is penalized by its relatively low proportion of GDP (5.12%) spent on education (Supplementary Table 1). Sweden scores well in Public Biotech Company, Education, Research & Translation and Fundamentals pillars but lags in the rankings in the Investment pillar: compared with Switzerland or Belgium, for instance, Sweden devotes a relatively high proportion of its GDP to venture investment, but a lower percentage of that capital finds its way to biotech. In 2019, the three countries with the highest level of biotech venture investment—as calculated from data in Supplementary Table 5 (the product of (column D) ‘Total Venture Capital 2019 as % of GDP’ and (column E) ‘Venture Capital 2019 in Biotech as a % of Total’—were Switzerland (0.099% of GDP), Israel (0.091%) and the United States (0.081%). The only other nations where biotech venture capital exceed 0.03% of GDP were European: Iceland, Belgium, Denmark, the United Kingdom and the Netherlands.

Denmark is fifth in our overall rankings (Table 1). Although it does have a burgeoning sector, it should be noted that its standout performance in the Public Biotech Companies pillar is skewed by direct contributions (revenue, R&D spending and employment) from just two companies: Novozymes and GenMab. Denmark is one of several relatively small European nations where the presence—or fading presence—of major pharmaceutical firms has led to the prioritization of biotech over other sectors in investment and research (see Supplementary Tables 5 and 6); others include Austria, Belgium and Switzerland.

Israel heads the Investment pillar rankings, with a high commitment to venture capital and high government spending on R&D (Supplementary Table 5). Israel’s venture capital was broadly spread among sectors in 2018, however, with <10% feeding biotech (compared with 15% in the United States and a whopping 40% in Austria, Switzerland and Iceland). Israel emerges from our analysis as a highly technocratic nation, with a large number of researchers and a high ranking in patent filings.

The European nations with larger populations—Germany, the United Kingdom and France—are in our top 15, but might have been expected to have higher rankings based on absolute numbers of investment and enterprises. The UK scores well in the Research & Translation and Investment pillars, particularly in life-science publications (Supplementary Table 6), but is behind France and Germany in the Public Biotech Companies pillar (Supplementary Table 4).

European nations perform particularly well within the Education pillar, notably formerly Eastern bloc countries, such as Estonia, Hungary, Poland and Czechia (Fig. 2; Supplementary Table 1), where membership of the European Union appears to have increased the level of student study abroad. Luxembourg tops the Education ranking, with Finland second and Estonia third (Fig. 2). Finland not only scores high for education spending overall and in the proportion of STEM graduates, but also has a high proportion of its population employed in research (Supplementary Table 7). Finland also ranks highly in Investment and, like other Nordic nations, has a public market that supports biotech stocks.

BRICS and MIKT

The term BRIC was coined in 2001 to refer to the large emerging economies of Brazil, Russia, India and China, which seemed then to have the potential to move relatively rapidly to a more industrially developed status. South Africa was added to the group in 2010, creating BRICS. MIKT (Mexico, Indonesia, South Korea, Turkey) emerged as another category in 2012. Seven of the nine BRICS–MIKT nations feature in our ranking; Indonesia and the Russian Federation are absent because of incomplete data for several pillars.

The remaining BRICS–MIKT nations show different levels of ambition in rising to fulfil their potential in biotech. It is clear that most have a long way to travel. With the exception of South Korea, the BRICS–MIKT nations are at the bottom of assessments in elements of the Fundamentals pillar, such as their regard for the rule of law or maintenance of regulatory quality. All, including South Korea, fall in the lowest quartile of rankings for the Legatum Index’s measure of societal cohesion, safety and personal freedom (Supplementary Table 8), although India, China and South Korea appear to have vastly improved their legal and regulatory machineries over a 5-year time frame.

In parallel, India, China and—to a lesser extent—South Korea have embraced venture capital as a lever of innovation: as a proportion of GDP, the total influx of venture capital into Indian companies lies only behind that of Singapore, Israel and the United States, with China close at hand in sixth place (Supplementary Table 5). The fraction of that venture capital that reaches biotech, however, is much lower than in the United States and leading European nations. Around 5.5–6.0% of venture capital in South Korea and China is devoted to biotech, compared with ~15% in the United States and 10% in Israel. India is further down that list, with just 1.6% of total venture capital devoted to biotech, but that is well ahead of Brazil, Mexico and Turkey, where no venture capital reaches biotech.

“In general, the BRICS-MIKT nations cannot yet be characterized as technology driven, with one exception: South Korea.”

In terms of finance, India, China and South Korea have qualifying public biotech company sectors, each stemming from the intersection of venture investment and existing pharmaceutical industries that serve their relatively large domestic markets. In China, the emergence of a rich urban subculture has helped create a parallel domestic market for elite healthcare solutions. India is a major global supplier of conventional small-molecule pharmaceuticals, generics and vaccines, with an increasing footprint in Europe and North America, but its innovative health biotech presence remains small.

In general, the BRICS-MIKT nations cannot yet be characterized as technology driven, with one exception: South Korea. The least technically oriented European nations (Italy, Poland and Spain, for instance) deploy over 2,200 researchers and technicians per million population; South Korea, in contrast, has 7,500 researchers and technicians per million. The numbers for the other BRICS–MIKT countries are much lower, with Turkey leading the way at 1,380, followed by China at 1,225 (Supplementary Table 6).

Amongst the BRICS–MIKT nations, government efforts to improve technical competency focus either on direct investment in R&D or on technical education. South Korea’s technical prowess has been underpinned by government spending on R&D—it tops the ranking with over 4.5% of its GDP devoted to government-backed R&D, just pipping Israel (Supplementary Table 5). Central R&D spending is high in China, too, at 2.15% of GDP. For other nations in this group, however, government expenditure on R&D is low, ~1% of GDP.

Some, but not all, of the BRICS–MIKT nations appear to be trying to make a difference through policies that focus on the education of STEM graduates. A large proportion of Indian, South Korean and Mexican graduates are in STEM fields: India ranks third of all the 40 nations in our survey in this regard, with South Korea fifth and Mexico well ahead of the United States and Canada. Turkey, South Africa and Brazil, however, have levels of STEM graduates that are similar to that of the United States (Supplementary Table 7). No information is available for China. Incidentally, India also tops the ranking for the proportion of female graduates in STEM subjects: 27%, well above the next countries, Singapore, Greece and Germany. This metric did not contribute to our ranking because data for key countries was absent.

Asia and Oceania

The ambition to grasp the opportunity of innovating in biotech is clear in Asia and Oceania: in addition to South Korea, China and India (see the BRIC and MIKT section), Singapore, Japan, Australia and New Zealand have also established sizeable publicly traded biotech sectors. Readers should note that Taiwan also has a sizable biotech sector (not included due to missing data in each of the five pillars).

Singapore has a history of deploying investment capital across innovative sectors in general. In the Investment pillar, the World Economic Forum ranks Singapore a joint fourth with Germany (behind Israel, the United States and Finland), whereas the Crunchbase data indicate that twice as much money was invested as a fraction of GDP in Singaporean ventures in 2019 as in their US equivalents (Supplementary Table 5). Those data were inflated in 2019 by major late venture rounds in internet-based service companies, such as Uber rival Grab and cloud-services firm Deskera. However, a relatively low fraction of that venture investment—around 2%—was funneled into biotech in Singapore. The fraction of venture capital reaching biotech is much higher in South Korea (5.5%) and New Zealand (8.7%), and marginally higher in Japan (2.01%). R&D spending by Japan’s government is high at 3.21% of GDP, well ahead of that in Singapore (2.17%) or Australia (1.92%), but still well behind South Korea’s 4.55%. (Supplementary Table 5)

Japan ranks strongly in the Research & Translation pillar, with high levels of patent filing, much of it focused on biotech. South Korea and Singapore score highly on patent filings overall, and New Zealand patent filing also ranks particularly high in the life sciences and biotech. The Anglophone nations of Asia, Australia and New Zealand, have stronger life science publishing records than the other nations in the group (Supplementary Table 6).

The proportions of graduates found in STEM subjects is above 25% in Singapore, South Korea and Thailand—a level that competes with that seen in the top European nations. Singapore has the second-highest level of STEM graduates seen anywhere, at 34.5%, with South Korea fifth and Thailand ninth. Those numbers might be expected to be high in Japan, too, but have not been collected. In contrast, the proportions of STEM graduates are relatively low in Australia and New Zealand—21.2% and 17.6%—perhaps reflecting economies that are strong in other industries, such as mining and agriculture (Supplementary Table 7).

Africa

Of the 54 countries in Africa, only South Africa has sufficient data to qualify for inclusion in our ranking. The country does have a growing venture capital sector and invests a small fraction of that money in biotech, which elevates its score in the Investment pillar above those of nations in Latin America and some in Europe. South Africa is in the lowest performance quartile in the Research and Translation, Education and Fundamentals pillars. Nevertheless, the country remains well ahead of other African nations in the parameters that we have assessed as contributing to innovation potential in biotech.

Perhaps the most surprising aspect of our Worldview ranking is that the US biotech sector did not come out on top. There is an almost universal acceptance that US biotech leads the world: the country is biotech’s birthplace, its world-leading biosciences institutions have ample government funding, its venture capital market is the largest in the world and its public capital markets (Nasdaq and NYSE) are second to none. The United States has the world’s leading regulator (the Food and Drug Administration). It also has the highest healthcare expenditure anywhere in the world, at 16.8% of GDP in 2019—nearly 50% more than any other nation’s. These are good conditions for biotech innovation. Above that of any other country, the US biotech industry employs more people, generates more revenue, spends more on R&D and leads in many related financial indicators—deals, salaries and indebtedness. Yet, in our ranking, the United States falls far behind several other nations in the Education pillar (Supplementary Table 7).

One factor that appears to count against the US biotech industry in the ranking is its size. Thanks to the dynamic natures of the Nasdaq and the US markets, there is a continuous churn of US public biotech firms, most of which generate little revenue or profit. In contrast, the seven companies from Denmark represent a disproportionate return, considering the size of the country’s population or GDP. Furthermore, on average the Danish public biotech firms generate more revenue and are more profitable than US public biotech firms, despite the presence of large-cap companies such as Gilead and Amgen on the US roster.

Another aspect that lowered the US score was education. US public sector spending on education as a percentage of GDP is lower than in many European nations, partly because of the higher GDP and partly because of an increased emphasis on privately funded higher education. In our ranking, the higher the public spend on education, the more positive a score for a country; thus, the United States’ emphasis on private education brings down its score relative to the rest of the world.

“Perhaps the most surprising aspect of our Worldview ranking is that the US biotech sector did not come out on top.”

Similarly, the Education pillar ranking favors those countries that send their students to study abroad—this is seen as a positive attribute of any nation’s workforce (promoting knowledge acquisition and broadening horizons and networks). Here again, the United States is penalized because its students may have less of an incentive to study abroad than students from the rest of the world, given that US higher education institutions are among the best in the world.

Finally, although the United States churns out plenty of graduates, relatively few of them focus on STEM subjects (only 17.9%, compared with>30% in each of India, Singapore and Germany). Again, this may reflect the surfeit of opportunities on offer to job hunters in the US economy in sectors outside biotech. And it may explain why the number of US citizens looking to be researchers and technicians per million population is lower than in many other developed countries: just over half the number of Israel, Denmark or Sweden and substantially fewer than in many technocratic nations (see Supplementary Table 6). This, again, leads to a lower score in the Education ranking.

Taken together, it is clear that US exceptionalism in education, economy and the job market count against the country in our ranking system compared with other nations.

On the flip side, our ranking reveals that European Eastern bloc countries have been making large investments in education and STEM careers. Countries such as Finland, Estonia, Hungary, Poland and Czechia (Fig. 2) place high in the Education pillar. And in these cases, membership in the European Union may have increased the level of student study abroad (Supplementary Table 7). It is also noteworthy that many countries outside the United States and Western Europe—for example, India, South Korea, Mexico, Brazil, Turkey, Singapore, Thailand and South Korea—are investing heavily in Education, and in STEM subjects in particular. It will be interesting to see whether—similar to the ‘sea turtle’ phenomenon in China—the return of these expatriates in decades to come will spur more economic activity (related to biotech) in these nations.

One other notable finding from our analysis was the high ranking of the Netherlands biotech sector. It is sixth in the world. Although Dutch biotech has been growing in stature in recent years, it is perhaps surprising to find that it now ranks ahead of the big three European powerhouses: the UK, Germany and France. Although Switzerland, Belgium, Denmark and Sweden have long been recognized as major players in European biotech, the Dutch sector has perhaps received less attention. The Dutch founder of Genzyme, Henri Termeer, may have played a role in building up the Netherlands in public biotech, acting as mentor, ambassador and connector to the US finance markets. But beyond that individual contribution, Dutch attitudes to commerce and focus on the life science underpin their position, as the Worldview data illustrate. The country ranks second in the Fundamentals pillar, shining particularly in stakeholder collaboration (joint in number with Israel and the United States), in cluster formation and, appropriately to its status as the new home to the European Medicines agency since Brexit, in regulatory quality, where it ranks second. The Netherlands also makes the top-ten nations in both the Public Biotech Companies and the Research & Translation pillars: the World Economic Forum’s soft metrics place the Netherlands third in IP protection and eighth in venture capital availability, positions reflected in hard data on biotech patents and venture capital investment in biotech.

Another interesting signal in our data is the growth of venture capital funds outside of the United States and Western Europe. Of course, to create a private biotech sector, any nation needs a source of available risk capital to enable ventures to go beyond initial seed funding. And in recent years, risk capital has been growing in Asia, particularly in China, India and Turkey, but also in Latin America (for example, Brazil and Mexico). However, it is notable that the lion’s share of venture capital funding in these countries remains devoted to sectors other than biotech (such as real estate). Thus, as a percentage of total venture capital funding, Turkish venture capitalists (VCs) spend nothing on biotech; Indian VCs devote only 1.6% of funding to biotech; and South Korean and Chinese VCs just 5.5–6.0%. In comparison, US and Israeli VCs spend 15% and 10% of their funding on biotech, respectively. It will be interesting to see how these percentages grow as investors in each of these countries become more familiar with biotech.

There are several caveats to our national ranking, the data we collected and the methodology we used.

Looking at biotech on a national scale fails to capture the clustering of biotech enterprises within countries—companies are not evenly spread out. Thus, in the United States, the vast majority of biotech activity is found on the two coasts, in Boston, California (the Bay Area and San Diego) and to a lesser extent in Seattle and in New York, New Jersey and Philadelphia; there is much less biotech going on in the other 44 states. It is important to note that the industrial cluster, an important concept in most high-technology endeavors including biotechnology, is not reflected in this nationally based analysis, except through one component of the Fundamentals pillar.

At the same time, national rankings also fail to capture the globalized nature of biotech. We adopted a national focus because of the reality that most data collected about biotech are gathered on a national level, not on an international level by a single body or collected into one central repository. Even so, in the twenty-first century, the biotech endeavor—like the science on which it is based, and like commerce more generally—tends to make a nonsense of nationhood. Companies conduct research and business and clinical trials internationally; their intellectual property, competition and collaborations are international; and most, especially the larger ones, have international operations. Students, senior executives and researchers cross continents to work. Yet the data presented here attribute all employees, revenues and R&D spending to the single country where the company headquarters are located. When domiciles are chosen for tax efficiency, or when mergers cross national boundaries, the same indicators of commercial innovation can be allocated to one country in one year and to another the next. We considered reallocating companies to countries on an operational basis or to more finely subdivide their resources, but both would lead to only marginal improvements for the amount of time that would need to be invested.

Another issue with our ranking is that only a limited number of nations had sufficient data available for all five pillars to qualify for inclusion in our ranking. In the Public Biotechnology Companies pillar, data are available on the performance of public companies and investment in private companies in only 24 of the most economically developed nations. Similarly, in the Research & Translation pillar, the Nature Index, which measures scientific publication output, has data available for only 50 nations. As low-to-middle-income countries do not figure in many of the available data sources, they are notably under-represented in our survey. Four of the six largest Latin American economies are present, but we would hope to include Argentina (the third-largest Latin American economy) and Peru (the sixth-largest) in future editions. In Asia, Indonesia, Malaysia, Vietnam and Pakistan represent major economies that are also absent from our dataset largely because of data gaps within the Research & Translation, the Public Biotechnology Company and Investment pillars.

“In the twenty-first century, the biotech endeavor—like the science on which it is based, and like commerce more generally—tends to make a nonsense of nationhood.”

Some of the current study’s limitations could be overcome in future editions of the Worldview by incorporating additional datasets into the Fundamentals, Education, Research & Translation, Investment or Public Biotechnology Company pillars. The modular design of our ranking and its emphasis on open sources of data means that additional public or proprietary datasets could replace, or be used alongside, our existing data sources.

In the Public Biotechnology Companies pillar, we could expand our set of public biotech companies to include endeavors beyond health biotechs elsewhere in healthcare (biosimilars, digital health, diagnostics and devices). If regularly updated global sources of data could be found, we could include public biotech companies working in agriculture, environment, energy or bio-based specialty or bulk chemicals and materials. It may also be possible to include data on the revenue, personnel, R&D spending or research focus of privately funded biotech companies, alongside the investment data that are currently collated.

Within the Research & Translation pillar, we feel that a key ingredient missing from the current ranking is the translation of research ideas into clinical practice through human testing. In unpublished preparatory work, we have explored the feasibility of using data from clinicaltrials.gov and similar sources to provide estimates of clinical trial expertise at the national level.

It may also be possible to improve the data we have used on R&D expenditure. We capture the broad swathe of national spending on R&D (GERD) within the Investment pillar, and we capture biotech-specific R&D expenditure within our Public Company data. Our data encompass, but do not specifically reflect, R&D spending by pharmaceutical companies or other non-biotech research-intensive firms, in the life sciences or otherwise.

Another aspect not currently represented in Worldview is data on the tech transfer sector. As yet, beyond the largely US-centric data from the Association of University Technology Managers (AUTM), which is unfortunately not broken down into specific sectors such as life sciences, there is a clear need for a global effort to gather such data on technology transfer offices across the world. The US Chamber of Commerce produces an IP index that captures these data for a limited set of nations, but as yet too many countries are missing for it to be included in this analysis. We have also considered refining the analysis of the scientific literature: the Nature Index provides a useful snapshot for exploring national contributions to high-end scientific publications, but it focuses on a limited number of prestige publications and consequently excludes many development nations with publication histories that are less deep. It is possible that a broader, less elite literature analysis from a resource such as PubMed might extend the range of countries that could be reliably included in the analysis. In the Education pillar, we would like to identify measures that are more biotech specific, as in some of the other pillars. We have data on the proportion of graduates in STEM subjects, for instance, but not on the proportion of those in life sciences specifically.

One of the more ambitious aims of this kind of analysis is to understand how countries that seek to improve biotech competitiveness should set about it: is it possible to identify, within the economic, industrial, educational or cultural environments, particular factors that could be prioritized to develop a more competitive national sector? Switzerland tops our ranking but does not, perhaps, provide a model for the growth of biotech that is easy to emulate elsewhere. Much of Switzerland’s competitive advantage stems directly or indirectly from its historically large multinational pharmaceutical sector—a local source of drug development personnel and early R&D programs, as well as a potential acquirer of developed products. Its drug industry has also shaped the nation’s underlying education and public research system. The presence of an active pharmaceutical industry attempting to reinvent itself for the modern age has also been a factor in the growth of biotech in Sweden, Denmark, France and the United Kingdom.

However, Israel, Belgium and the Netherlands have shown the importance not only of a vibrant education and research base but also of access to structured, innovation-oriented finance: venture capital can mobilize early ideas, but public market funding is necessary to provide the longer horizons that clinical development requires.

We hope that the data presented here is a useful resource for the biotech community. By making the data and methodology open, we anticipate that others will be able to contribute their own insights and build from our data.

Authors and Affiliations

1. LifeSci Advisors, New York, NY, USA

   John Hodgson

2. Juxdapoze, LLC, Germantown, MD, USA

   Deanna Schreiber-Gregory

Corresponding author

Correspondence to
John Hodgson.

Competing interests

J.H. is managing director of communications Europe at Life Science Advisors. D.S.-G. is research statistician and data manager at Juxdapoze.

Peer review information

Nature Biotechnology thanks Rob Carlson, Claire Skentelberry, Mary Walshok and Patrick Kilbride for their contribution to the peer review of this work.