Innovation and consumer protection are not opposites. Indeed there is huge potential to use innovation to deliver safer products that benefit consumers, writes Monique Goyens.
Monique Goyens is Director General of BEUC, the EU consumer organisation.
More than 500 million consumers in the European Union benefit from innovation on a daily basis. Without innovation, we would not be able to check the weather on our smartphone or consult a health app whether we should go for another run in the evening to burn some calories. And telemonitoring applications can prevent unnecessary visits to the hospital. But these examples say little or nothing about the value of innovation itself. It is just as easy to give examples of innovation going wrong.
Innovation has been making headlines recently with a strong push – for instance by the Commission’s in-house think tank – for the EU to both be more innovative and be more innovation-friendly. After all, it fits well with the mantra calling for growth and jobs which is one of the things defining policy-making at European and national level.
But what does an innovation agenda mean for consumers? If being innovation-friendly is supposed to become a driving force for policy-making in the EU, then consumer perspectives need to be taken into account.
Sadly, innovation often does not reflect the actual needs of consumers, and is not necessarily targeted at the right population groups.
Who benefits from innovation?
For example, when food companies fortify products with vitamins so that they can sell them as being “rich in vitamin c”, there is little real benefit for the consumer.
Similarly, supposed innovations in the health sector are not delivering the therapies that patients need. Recent medical innovation has made remarkable advances for a limited number of conditions while yielding unimpressive results in most other disease areas. For example, the threat of antibiotic resistance means there is a need for new antibiotics, but these medicines are generally not as profitable as others and innovation has stagnated.
Innovation can increase risk
Many new medicines that enter the market do not offer consumers any additional benefit compared to existing treatments. In France, only 2% of new medicines licensed between 2000 and 2013 offered a real advance for their approved indications. The situation is similar in Germany and the Netherlands. Yet new treatments expose patients to increased risks (because they are new and have been tested only on a small group of people).
At times, the consequences for consumers seem to be consciously disregarded in the desire to make life easier for innovators. Industry, for instance, advocates for a ‘risk based approach’ in chemicals management – because it makes it easier to put a product on the market – rather than using a ‘hazard based approach’. However, these risk assessments are in many cases not meaningful because there is a lack of adequate data.
A full assessment should consider all the ways in which we can be exposed to a chemical (through the skin, inhalation, ingestion) and all possible sources of exposure. For some chemicals which are known to cause cancer it is not possible to establish safe thresholds (as any exposure can damage health). Thus, risk-based assessment do not sufficiently capture the possible harm to consumers.
How should we respond to this challenge of bringing innovation policy in line with consumer needs and expectations?
Firstly, it is important to take a broader perspective on innovation to ensure policy decisions designed to encourage innovation are made in the best interest of consumers. Consumer benefits must be central for innovation to be well accepted and, ultimately, successful on the market.
Let me take another example from the health sector. Public funded research should be driven by public health needs. Yet the priorities of the largest EU public-private partnership for the development of medicines, the Innovative Medicines Initiative, has so far focused on less than half of areas of medical need identified by the WHO.
Secondly, encouragement for innovation must be balanced by the use of the hazard-based approach and the precautionary principle. If a lion is in a cage you have no risk to be injured. However, there is an inherent hazard that you could be injured in case the cage is left open. Similarly, in the case of innovation, certain novelties should be abstained from or only be allowed with the necessary safety measures because there is a hazard of consumer-harm.
Innovation and consumer protection are not opposites. Indeed there is huge potential to use innovation to deliver safer products that benefit consumers. And creating safer markets for consumers will also improve competitiveness.