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“The Community of Madrid's strategy for attracting foreign investment focuses on high value-added industry, where the life sciences sector plays a key role. Our region offers the perfect ecosystem for the life sciences sector: an excellent R&D&I network, the best talent, an extraordinary healthcare system, and quality of life. In fact, we have one of the highest life expectancies in the world”- Luis Socías, Executive Director of Invest in Madrid
EF: Could you provide an overview of the current investment landscape in Madrid and outline the agency's key priorities at this time?
AO: Over the past five to six months, we have been working to define the priorities for a region like ours. Our focus has been on various activities, sectors, and markets, and we are conducting thorough analyses during this time. After much consideration, we have identified seven sectors that need particular attention, aligning with our international focus and agenda. These sectors encompass both traditional and emerging industries. In Madrid, for instance, aerospace and defense, automotive, logistics & mobility, pharma, and biotech are among the traditional sectors. Additionally, we are eyeing four other sectors that showcase promising potential based on the skills and talent available, both locally and internationally. These include data centers, digitalization & AI, semiconductors (chips & microelectronics), and the audiovisual sector, encompassing animation and video games.
In terms of markets, we are concentrating on territories that have been traditionally the main investors both in Spain and Madrid, such as the US, key European countries like the UK, France, and Germany, and strategic partners in Latin America, including Mexico, Chile, Argentina, and Colombia. Moreover, Japan is a significant focal point in Asia. Our aim as an agency is twofold: to provide comprehensive information to companies across sectors and regions, enabling them to make informed decisions, and to serve as a holistic agency offering a 360-degree approach. This involves leveraging our extensive network, encompassing both public and private ecosystems, clusters, institutions, and other stakeholders. Ultimately, our goal is to support foreign companies, particularly those in the healthcare, biotech, and pharma sectors, by providing them with the necessary resources and insights to thrive in our region.
EF: Why do you believe Madrid is so attractive from a life sciences perspective?
AO: Apart from the general information relevant to any investment, such as talent, quality of life, and infrastructure, there are sector-specific considerations to take into account. For example, infrastructure designed for the sector's needs, including facilities for exports, plays a crucial role. Additionally, the regulatory framework and institutions governing the sector have a significant impact nationally. Most pharmaceutical companies have a presence in both Madrid and Catalonia, leveraging these regions for innovation centers or headquarters. This allows companies to maximize their influence on a national scale while accessing talent and information from both regions. Traditionally, the sector has been divided between Madrid and Catalonia, but recent years have seen significant investment, with over 60% of the national FDI inflow directed to Madrid due to its robust infrastructure, talent pool, and access to key institutions. In addition to regulatory bodies, biomedical reunions, hospitals, and research centers contribute to a thriving ecosystem. The concentration of hospitals, both public and private, facilitates clinical trials and drug testing, supported by clusters focused on health and technological innovation. This collaborative ecosystem encourages innovation from scientific research to patient care, making it a critical aspect of the sector.
Madrid, from a Spanish standpoint, is an energetic city. Having around 7 million people packed closely together in one region brings numerous opportunities for companies and institutions. Twenty years ago, the landscape was entirely different. Companies may have collaborated with universities, but that was the extent of it. Now, however, innovation has united with research institutes facilitating projects from both companies and universities. Over the past two decades, relationships between universities and companies have grown, leading to stronger partnerships. This period has also seen the emergence of clusters, which address issues like skills and talent shortages, which are particularly dominant in scientific and technological fields. This transformation did not happen overnight; it has been a gradual process over the past few years.
EF: How does your agency support companies after they have invested in Madrid? What kind of ongoing assistance do you offer?
AO: The first and perhaps most crucial step is to establish a strong relationship with them. It is essential that they feel comfortable reaching out to an institution like ours and sharing their challenges so we can offer assistance. Building this trust is key to encouraging them to tell us about projects critical to their expansion and development in the region, which ultimately leads to job creation. We approach different sectors and companies through various means, such as workshops and sector-specific events like business breakfasts, to keep them engaged and informed about how we can support them. Once this connection is established, they often reach out to us for help with specific issues.
For example, with Moderna, they encountered challenges related to licensing and building permits. We leveraged our network to liaise with the city council and regional government to clarify the process and timeline, ensuring Moderna had all the information they needed to navigate the regulatory landscape effectively. This ongoing dialogue allows us to address their needs and provide timely assistance, particularly in administrative matters like licensing, which can significantly impact their project timelines.
EF: What qualities do you see in local companies that make them attractive partners for multinationals looking to invest in Madrid and form partnerships?
AO: The significant aspect here is the absence of local players. It is crucial to recognize that entities like PharmaMar are no longer merely local players but have evolved into multinational corporations. Their advanced level of innovation, technology, talent, and scale sets them apart. This transformation from local to multinational status demonstrates to foreign companies the potential of the Spanish market. It highlights the opportunities for both local and multinational players to thrive in this ecosystem and expand into other markets.
For example, Latin American firms perceive Madrid as a gateway to the European market, while European companies see it as a springboard to Latin America. This mutual recognition underscores Madrid's strategic position for international business ventures. With an established ecosystem, growth accelerates, attracting talent and fostering collaboration with universities to cultivate specialized skills. This ecosystem is not new; multinationals have been establishing themselves here for decades, initially drawn by Spain's economic standing in Europe. However, in today's global economy, the emphasis is not solely on market size but on leveraging Spain as a hub for production, knowledge development, and scientific research.
EF: What are your top three favorite things about Madrid?
AO: First, the ecosystem here in Madrid is key. People from all over come here for work or study, and they feel like they belong right away. It is a welcoming place with lots of big companies and startups all working together. Many of us came here for university and decided to stay because Madrid offers a good balance between work and life. Plus, there is so much to do here, from going out to eat to enjoying cultural events.
Secondly, culture, leisure, and food play a big role in making Madrid special. The city's rich culture and delicious food make it a great place to live and work. These things might not always get talked about in discussions about the economy or talent, but they matter a lot to people when they are deciding where to live and work.
Lastly, location and infrastructure are crucial. Madrid's central location in Spain, along with its well-developed infrastructure like highways, railways, and airports, make it easy to get around. This connectivity extends beyond Europe to Latin America, making Madrid a prime spot for businesses in various sectors, including healthcare. If you look at the ecosystem here, especially in the healthcare industry, with all the companies, research centers, hospitals, and universities, you will see why Madrid is a top destination for the sector.
EF: Do you have any final message for our readers?
AO: I would like to say that we are not just focused on the healthcare sector alone. We are also looking into investment opportunities across various sectors, aiming for both public and private collaboration. This collaborative approach has been a longstanding practice in Spain, particularly in Madrid, where we are actively seeking ways for companies and the government to work together. In terms of healthcare, we have pinpointed three potential areas where such collaboration could thrive.
Firstly, there is the digitalization of the healthcare system, which requires investment that the government alone cannot manage, presenting opportunities for foreign companies. Secondly, there is the need to refurbish hospitals, which could also involve partnerships between public and private entities. Lastly, there is the initiative to establish a Neurotech center in Madrid, which could open up avenues for investment and collaboration across sectors, including healthcare.
