U.S. biotechs are increasingly reluctant to license their drugs to European partners due to the risk of becoming a target of the Trump administration, industry insiders have told Fierce Biotech.
Emmanuelle Trombe, a French lawyer with 20 years experience in helping European biopharmas secure the regional licenses to drugs developed by American biotechs, said these negotiations have become “more and more difficult” this year due to a fear of being criticized by the U.S. government.
Drug prices have been in the crosshairs of the second Trump administration from its first days in office, with a Sept. 29 deadline now looming for pharmaceutical companies to adhere to President Donald Trump’s most favored nation (MFN) drug pricing system in the U.S.
While analysts have characterized Trump’s MFN executive order as having more bark than bite and likely being subject to future legal challenges, the initiative is designed to match the costs of prescription drugs in the U.S. to the lowest prices offered in other developed nations.
Paris-based Trombe, who is co-head of law firm McDermott Will & Schulte’s life sciences industry practice, told Fierce that since Trump’s reelection, she has seen a desire among U.S. biotechs to maintain a higher degree of control over the European rights to their drugs during licensing negotiations.
“It’s coming [up] in every discussion now: How do you protect the European franchise? If you can drive market access in Europe with a lower price, how do I make sure that my U.S. franchise is not impacted?” she said.
In order to dodge accusations of underpricing drugs abroad, there is also the possibility that U.S. companies avoid marketing their drugs in Europe altogether, Trombe said.
This has led to “a lot of public concern on the [European] continent about access to drugs that are also commercialized in the U.S.,” she explained.
The debate over drug pricing disparities came to a head in the U.K. this month, with a roll call of Big Pharmas announcing plans to scale back or pause R&D funding in the country in protest over the outcome of government pricing negotiations.
Sharon Lamb, head of McDermott’s U.K. healthcare practice group, told Fierce that the blowback from pharmas to the U.K. pricing system had been “a long time coming.”
At the heart of the current dispute is the government’s move to increase the proportion of sales of newer branded medicines that pharmas must pay back to the U.K.’s National Health Service from 15.5% to 31.3%.
Lamb said this had “obviously not landed well” with drugmakers.
Both Trombe and Lamb spoke to Fierce yesterday on the sidelines of Healthcare Private Equity Europe 2025 in London, where investors gathered to discuss trends in the European healthcare market.
A common theme from attendees was a cautious optimism that after three years of a challenging fundraising environment, the outlook is starting to improve.
Trombe echoed this prognosis, pointing out that despite the “uncertainty around market access … we all know that the sector is resilient [and] there is a need for innovation.”
Even the tough climate around pricing disparities could generate its own winners, especially when it comes to pharma services providers, according to Lamb.
“There are opportunities here,” she told Fierce. “If you were looking at efficiencies and manufacturing that were going to bring a streamlined or effective [drug] price to market—these are going to be highly valuable investments.”
Paul Tomasic, head of European healthcare at global investment bank Houlihan Lokey, told Fierce that investors are less enthused by early-stage drug development opportunities at the moment and are more excited by healthcare companies that can demonstrate they are a “growth-driven business.”
“When we see large funds that have raised private equity and look at where they're putting money in profitable businesses rather than venture, I think we're seeing a lot of activity in medtech,” he said. “We're [also] seeing renewed activity in healthcare services.”
“One area where venture is starting to maybe explore a little bit deeper is probably anything that has technology-driven solutions for drug discovery,” Tomasic added.
He cited AlphaFold, an artificial intelligence system developed by Google DeepMind that predicts a protein's 3D structure, as an example of how investors are interested in ways of “using data to approach some of that drug research.”