Want to know what are the impacts achieved by pre-commercial procurements (PCPs) funded by the EU’s research and innovation program? New data from a survey of all the completed PCPs that were funded by Framework Program 7 shows now also longer term impacts on the commercialization success rate of companies and the modernization of public services. Check out also how the impacts of the EU funded PCPs compare to those of PCPs implemented at national level or to those of other procurement approaches, such as the innovation partnership procedure.
Updated data from the first 22 ongoing and completed PCP projects:
- Opening a route-to-the market for new market players: 73,5% of PCP contracts are won by SMEs, 61,5% of total values of PCP contracts, more than twice the average in public procurement across Europe (29%).
- Helping also larger market players bring products to the market: 16% of PCP contracts are won by large companies as single bidder. 19% of PCP contracts are won by consortia of large companies plus SMEs to bring products together to the market.
- Impact on stimulating cross-border company growth: 33,1% of PCP contracts are awarded cross-border, 20 times more than the average in public procurement across Europe (1,7%).
- Bringing research results to the market: 30% of contracts have universities or research centers as partners in the winning consortia (often together with university startups)
- Contribution to growth and jobs in Europe: Nearly all bidders (99,5%) are doing 100% of the R&D for the PCP contract in Europe
- Reducing the R&D risk for procurers / encouraging commercialisation of solutions by vendors: leaving IPR ownerhsip rights with the vendors reduced the R&D cost/risk for procurers on average with 50% as companies see wider commercialisation opportunities
Analysis of all the completed FP7 funded PCPs reveals additional longer-term impacts on procurers and companies a few years after the procurements have ended:
- Increased commercialisation success rate of companies: 86% of Phase 3 PCP contractors, 75% of Phase 2 contractors and 29% of Phase 1 contractors have already commercialised (part of) their PCP solutions. 11% of contractors (across Ph1/2/3) still expect to commercialise solutions within 2 years. 17% of contractors (across Ph1/2/3) do not plan commercialisation. According to companies surveyed, PCP at least doubles their normal commercialisation success rate compared to when they develop a product alone or with grant support (even in collaborative grants with potential customers).
- Steady business growth: ~50% of all companies are already generating revenue from commercialising their PCP solution. 24% of participating start-ups have already secured equity investment since the PCP. 18% of start-ups have already concluded partnerships with larger corporates to commercialise their solution. On average 1 SME per PCP project uses also the synergies with the EU SME instrument to grow their business.
- Exit strategies: 3% of start-ups have done an IPO since the PCP. 12% of start-ups have undergone a merger or acquisition.
- Deployment of solutions by procurers from the project: All completed PCPs delivered solutions that improve the quality and efficiency of public services. Procurers from 55% of the completed PCPs have already deployed developed solutions. Procurers from 45% of the completed PCPs have not deployed solutions ‘yet’ because of delays in other deployments, delays in standardisation or certification / clinical trials.
- Wider deployment by other procurers on the market: Procurers from 27% of completed PCPs are already preparing new larger scale procurements with an enlarged buyers group.
Want to know how the impacts of EU funded PCPs compare to the impacts of PCPs that are implemented at national level? Or how the impact of PCPs compare to other procurement approaches, like the innovation partnership procedure? This and more detailed info in the following slide pack.
More info about the FP7 and Horizon 2020 funded PCP projects themselves can be found on the PCP projects page.
More info about the winning bidders, the scope and progress of each PCP can be found on the website of each PCP project.