In European healthcare, reimbursement often serves as a validation of clinical and cost-effectiveness, indicating that a treatment, device, or therapy meets the necessary criteria for adoption by public healthcare systems. Without reimbursement, even the most innovative solutions struggle to reach patients, as healthcare providers and insurers tend to prioritize treatments that are covered.
Europe boasts world-class universities, cutting-edge research, and a strong tradition in Medtech development, positioning it as a leader in healthcare innovation. However, despite these strengths, fragmented and overly complex reimbursement policies are creating significant barriers for startups, stifling innovation and slowing the pace of healthcare advancements across the continent.
European healthcare systems, while united in their commitment to universal care, are deeply fragmented when it comes to reimbursement processes. Each country operates its own reimbursement approval mechanisms, involving different criteria, timelines, and processes for new medical devices, drugs, and health technologies.
For startups, this fragmentation means navigating multiple sets of rules to get their innovations approved and reimbursed. A new diagnostic tool, for example, might require approval from different national health authorities with vastly different requirements. In Germany, companies face a complex evaluation process via Institut für Qualität und Wirtschaftlichkeit im Gesundheitswesen (IQWiG), whereas in France, the Haute Autorité de Santé (HAS) evaluates products under different criteria.
This disjointed approach results in delayed market access, significantly increasing the time and cost it takes for startups to scale their innovations across Europe. What should be a smooth expansion from one market to another becomes a convoluted process that requires startups to jump through bureaucratic hoops in each country, stretching their limited resources.
The complexity of the reimbursement system disproportionately impacts startups and small innovators. Large pharmaceutical companies and Medtech giants can absorb the costs and delays associated with multiple applications, thanks to their extensive resources and dedicated regulatory teams. Startups, however, lack the same luxury. For a small company trying to get an innovative medical device approved, these fragmented reimbursement policies can be a make-or-break hurdle.
Additionally, large companies often have established relationships with national healthcare systems and are better equipped to navigate complex pricing negotiations and market access. Blue-chip companies are well-positioned to maintain dominance in the market, leaving startups in the dust. The sheer cost and effort required to go through country-by-country approvals often lead startups to focus only on a few key markets, further limiting their potential growth.
For healthcare startups, reimbursement is the main gateway to revenue and the ability to scale. Without clear, predictable reimbursement processes, startups are hesitant to invest in expensive research and development. The risk of being caught in prolonged reimbursement limbo discourages the very kind of innovative thinking that Europe should be championing.
For instance, startups working in digital health and AI-driven diagnostics often face an uphill battle to get reimbursed. Traditional reimbursement models aren’t always equipped to handle emerging technologies that don’t fit neatly into existing categories. Many digital health solutions, which could greatly enhance preventive care or chronic disease management, are delayed in reaching patients because national health systems are slow to update their reimbursement frameworks to include new kinds of treatment or technology.
The solution lies in creating a unified European reimbursement framework — one that simplifies the process for startups while allowing national governments the flexibility to decide whether and how much to reimburse for a given treatment. Under such a system, startups would face a standardized process for applying for reimbursement across all European countries. The requirements, documentation, and evaluation criteria would be the same, no matter where they apply.
Countries would still retain the final say on whether they choose to reimburse a treatment and at what percentage (e.g., from 0% to 100%), but the overall process would be consistent and transparent. Startups could focus on innovation, confident in knowing what to expect from each market, and they could plan better for pan-European scale.
This harmonized approach would significantly reduce the costs and time delays currently suffocating smaller players. It would level the playing field, allowing startups to compete more fairly with established corporations and bringing innovation to patients more quickly. Additionally, patients across Europe would benefit from faster access to cutting-edge treatments and technologies, reducing healthcare inequalities between regions.
If Europe wants to remain a global leader in Medtech, Biotech, and Digital Health, its reimbursement policies must evolve. Simplifying and unifying the reimbursement process across European nations would remove unnecessary barriers, stimulate startup growth, and promote healthcare innovation. Policymakers must prioritize reform that encourages a more agile, startup-friendly system, where the emphasis is on improving patient outcomes and fostering innovation, not on maintaining bureaucratic status quos.
In an era where healthcare innovation can save lives and reduce costs, the current fragmented reimbursement system is doing more harm than good. Europe can and should be the place where healthcare startups thrive, but for that to happen, the policies that guide market access need to catch up with the pace of innovation.