Memorandum by the Bioindustry Association
(PI 147)
I. INTRODUCTION
1. The BioIndustry Association (BIA) congratulates
the Committee on this inquiry and is pleased to have the opportunity
to submit evidence.
2. The BIA is the trade association for
innovative enterprises in the UK bioscience sector. We represent
over 350 members, the majority of which are involved in realising
the human health benefits that bioscience promises.
3. The UK bioscience industry is the European
leader and second globally only to the US. One third of Europe's
bioscience companies are in the UK.
4. At the end of 2002, the sector:
comprised 486 companies;
employed approximately 25,930 people;
had 225 new drugs in clinical development
or awaiting approval; and
had 47 publicly quoted companies
with a total market capitalisation of
9.7 billion.[52]
5. The BIA defines bioscience companies
as those that are developing products or services that are derived
from the study of living systems, or use living systems in their
research, development and/or manufacturing activities. Such companies
will typically be operating in the fields of human or animal healthcare,
including diagnostics, therapeutics, vaccines and nutrition; environmental
protection and remediation; or will be companies providing technical
services to such companies.
6. The BIA, in conjunction with the DTI
and the DH, last year led the Bioscience Innovation and Growth
Team (BIGT), whose report, Bioscience 2015Improving National
Health, Increasing National Wealth,[53]
was published in November 2003.
7. Bioscience 2015 is the biggest policy
review of the sector to date and follows months of consultation
with more than 70 leading industry figures. The report, with a
foreword by the Prime Minister, said the UK must act now to secure
its leading position as other countries recognise the value of
a vibrant bioscience sector. The recommendations in the report
form the core of this written submission.
8. This response focuses on the following
areas of the Committee's inquiry:
the conduct of medical research;
regulatory review of drug safety
and efficacy; and
II. EXECUTIVE
SUMMARY
9. The BIA makes the following points in
this submission:
10. Unmet medical needs remain high and
bioscience has the potential to address them, which would not
only improve health but also the economics of preventative medicine
and treatment of illness.
11. A supportive regulatory environment,
both in the UK and EU, is critical to the ability of the UK bioscience
sector to deliver human healthcare benefits. A growing number
of regulatory decisions are made at EU level, many of which threaten
to hamper the ability of the bioscience sector to develop medicines
and to disincentive innovation.
12. Bioscience companies need adequate funding
to ensure their ability to innovate and deliver new medicines
and treatments.
13. Improving the UK's clinical research
infrastructure will help to deliver new treatments and cures for
patients, give the UK the opportunity to become the world-leading
location for clinical research, and attract industry, academia
and investment to the UK.
14. Industry should work with NICE, MHRA
and EMEA to improve transparency in order that MHRA, EMEA and
industry engage early in the development process to discuss which
patient outcomes will be important for subsequent acceptance.
15. More needs to be done to ensure early
access to life-saving medicines for patients. The new EU pharmaceutical
legislation (Regulation (EC) No 726/2004) is a helpful step towards
introducing a system for provisional licensing of drugs, similar
to the French Autorisations Temporaires d'Utilisation (ATU) de
cohort system, which would make promising new treatments available
to patients where a genuine public health need exists, often before
the completion of Phase III clinical trials. However, it falls
short of recognising that products supplied for compassionate
use are equivalent to authorised products for the purpose of reimbursement.
16. A robust approval procedure for biosimilar
medicines (please see definition in paragraph 65) is necessary
not only to guarantee patient safety but also to protect the future
of biotechnological innovation in the healthcare industry in the
UK.
17. PPRSprice modulation across portfolios
is a disincentive for innovative, emerging companies in the UK.
If this and other bioscience-specific issues are to be fully discussedfor
the benefit of patients, the NHS, and the taxpayerrepresentation
of the bioscience sector needs to be ensured in future PPRS (or
equivalent scheme) negotiations.
III. DRUG INNOVATION
(i) An innovative sector addressing unmet
medical need
18. Biopharmaceutical drugs account for
8% of total global pharmaceutical market sales, and are the fastest
growing part of the market.[54]
They will be an increasingly important part of the healthcare
landscape over the next decade. One third of all drugs in development
are now biologics.[55]
While non-chemical entity (NCE)-based pharmaceutical company growth
is expected to slow, due to patent expirations and pipelines of
incremental innovation, biopharmaceuticals are widely expected
to deliver both improved R&D productivity and strong growth.
19. UK bioscience companies have produced
42 marketed biotech drugs[56]
with a further seven waiting for approval and at least 23 in phase
III trials. The UK bioscience sector has the largest product pipeline
in Europe, with 225 of the European total of 502 drugs in clinical
development of awaiting approval.[57]
UK companies have developed 43% of the products in late-stage
clinical trials in Europe.[58]
20. Unmet medical needs remain high and
bioscience has the potential to address them, which would not
only improve health but also the economics of preventative medicine
and treatment of illness. New bioscience technologies, such as
genomics, proteomics, and bioinformatics, have the potential to
address many medical challenges. Although tests that enable early
diagnosis and highly effective innovative treatments are expensive
on a per unit basis, they can reduce the total cost of care and
the economic burden of disease. A good example of this is seen
with diabetes. Regranex, a recombinant treatment for diabetic
foot ulcers, is expensive, with one 20-week treatment costing
at least £550-825. However, combined with appropriate ulcer
nursing, Regranex actually reduces the cost of care and improves
health (providing more healthy months and fewer amputations) compared
to the alternative of ulcer nursing on its own.[59]
21. Bioscience has the potential to enable:
earlier identification of disease
risk and disease diagnosis, through genetic screening and diagnosticseg
as seen in breast cancer;
development of targeted drugs, with
higher efficacy (because they focus on particular patient pools
or forms of disease), and improved safety (because they may reduce
side effects);
faster and more precise detection
of pathogens;
disease prevention through more effective
and targeted vaccines;
new modes of treatment for previously
untreatable conditions, eg engineered tissue, stem cell therapies;
and
Faster drug development, which will
enable faster delivery to patients of critical treatments.
22. At the same time, it should be remembered
that generally accepted pharmaceutical industry data shows that
it takes 10-15 years and in excess of $800 million[60]
to develop a drug launched in the US or Europe and that less than
half of these drugs ever repay their costs of development. Only
one in nine drugs entering clinical trials will ever be launched.
Most UK bioscience companies are not yet profit-making. At the
start of 2003, there were 18 profitable bioscience companies in
the UK.[61]
(ii) Barriers to innovation
23. A supportive regulatory environment,
both in the UK and EU, is critical to the ability of the UK bioscience
sector to deliver human healthcare benefits. The UK has been a
leader in establishing appropriate, science-based regulation in
a number of areas, such as stem cell research. However, a growing
number of regulatory decisions are made at EU level many of which
threaten to hamper the ability of the bioscience sector to develop
medicines. Often the real threat is from other EU Member States,
which either do not understand the potential benefits of bioscience
or do not consider its continued development to be a priority.
This threat was highlighted by the Prime Minister in Prime Minister's
Question Time on 18 June 2003:
24. "The biotech industry in this
country is immensely important, and it is important for its future
that decisions made by Government will be based on proper scientific
evidence. It worries me that there are voices, here and in the
rest of Europe, that are not prepared to give enough consideration
to the potential benefits as well as the potential downsides."
25. Bioscience 2015 recognised that "the
increasing requirement of regulation, due to heightened concern
for the precautionary principle, threatens to stifle innovation."[62]
The recently published Research for Patient Benefit Working Party
report[63]
also recognised that a review of the regulatory environment for
clinical research in the UK needs to take place.
26. Overly restrictive regulation reduces
the incentive to investigate and develop innovative drug therapies.
It also lengthens the time, increases the cost, and constrains
the market for innovative drugs, usually without any increased
patient safety. Bioscience companies have limited financial resources
and are producing innovative and expensive medicines, so these
cumulative constraints weigh particularly heavily.
27. There is also a real risk that the health
benefits of this regulatory tightening will be more than offset
by significant health costs, including:
loss of some drug development (due
to lack of R&D);
delays in drugs reaching the market;
higher cost of new therapies leading
to de facto rationing of supply; and
weakening of competition among suppliers
through inhibition of new market entry.
28. An example of the increasing regulatory
requirements from EU legislation is the recently implemented Clinical
Trials Directive, which tightens regulation, monitoring, and standards
for early stage clinical trials. Bioscience 2015 expressed serious
concerns that the implementation of the Directive into national
legislation could have a negative impact on the attractiveness
of the UK as a location for clinical research, in terms of extra
costs, and bureaucracy. The report also expressed real concerns,
in particular, about the requirement for all Investigative Medicinal
Products (IMPs) to be Good Manufacturing Practice (GMP) compliant,
and the increase in statutory time periods for regulatory and
Ethics Committee approval of trials.
29. The MHRA's commitment to appropriate
implementation of the Directive was key; it took on board industry's
concerns about the possible crippling impact of the Directive
on early stage research, in fact delaying implementation of the
Directive to further examine these issues. The BIA believes that
the implementing Regulations in the UK are as sensible as they
could have been, although the impact of the Directive over time
will need to be monitored.
30. Another recent example of EU over-regulation
concerns the recent revision of the EU Technology Transfer Block
Exemption Regulation (TTBER), which came into force in May 2004.
The TTBER is a set of terms and principles that allows the drafting
of commercially viable licensing agreements with reasonable certainty
that they will not be found to be anti-competitive under competition
law. The industry has operated successfully with the old TTBER
but the new rules will mean that most licensing agreementsthe
life-blood of the bioscience industrywill lose the certainty
of the TTBER regime.
31. To come within the new rules, companies
working together must now not have a combined market share of
more than 30% of either technology or products. The innovative
nature of the bioscience sector means that companies can find
themselves at times with a high, even a 100%, market share. Many
bioscience licensing agreements will now fall outside the new
Block Exemption, resulting in higher legal costsan unnecessary
and unhelpful burden for emerging, innovative companies. The BIA
is monitoring the impact in practice of the revised Regulation
on licensing agreements and would be happy to keep the Committee
informed of results of this work.
32. Increased uncertainty and additional
bureaucracy, of which the Clinical Trials Directive and the TTBER
are but two examples, could reduce the ability of the industry
to deliver new treatments for the many life-threatening and debilitating
diseases that still have no cure. This flies in the face of the
European Commission's own Life Sciences and Biotechnology Strategy
and its recently launched consultation, "Innovate for a competitive
Europe". If the regulatory environment continues to stifle
innovation, the real losers will be the end-userspatients.
(iii) Innovationthe impact of consolidation
33. A key driver of innovation is the ability
of companies to access sufficient capital to undertake the research
and product development required in order to bring life-changing/life-enhancing
or life-saving drugs to the user.
34. In the long term, there are benefits
for both patients and the NHS if pioneering drug companies are
able to innovate, grow and develop products and still remain UK-based,
without automatically being acquired by other, larger companies
once they reach a certain size.
35. Currently, there are many excellent
UK bioscience companies with world-class science and management,
whose ability to continue to innovate from the UK is hampered
because of an unequal "equity playing field". In simple
terms, successful innovative UK biotech companies grow to a certain
point when their capital requirements mean that they are nearly
always obliged to access US capital markets in order to continue
the drug innovation process, which itself often means being acquired
by large companies.
36. We now need to ensure that UK bioscience
companies are adequately funded so that innovation can benefit.
We hope that the Committee will agree that we owe it to all those
suffering from illness to ensure that the UK remains a world leader
in bioscience. Specifically, Bioscience 2015 recommended:
Amending the pre-emption Guidelines
to permit UK-listed life science companies to issue up to at least
20% of their share capital on a non-pre-emptive basis.
Strongly supporting efforts to create
a more accessible and liquid capital market for technology companies,
through harmonisation of listing rules and through a LSE-led pan-European
technology exchange.
37. These measures would have a positive
impact on innovation and bring direct benefits to patients and
procuring public bodies.
IV. THE CONDUCT
OF MEDICAL
RESEARCH
(i) Building a mutually advantageous collaboration
between the NHS and Industry for patient benefit
38. The BIA would like to bring to the Committee's
attention one of the key recommendations in the Bioscience 2015
report in which the BIA is closely involved in taking forward.
39. Improving the UK's clinical research
infrastructure will help to deliver new treatments and cures for
patients, give the UK the opportunity to become the world-leading
location for clinical research, and attract industry, academia
and investment to the UK.
40. The report recognised the need to ensure
that UK patients must not be left behind in their access to innovative
treatments. Tapping the full potential of the NHS patient pool
was seen as a way of building sustainable competitive advantage
in clinical research, and in bioscience, for the future. The power
of this asset will grow over the coming 10 years, as new technologies
such as genetics, transcript profiling, proteomics and metabonomics
start to be used more frequently in clinical development and practice.
41. Bioscience companies find it challenging
to access patients for clinical trials in the NHS. There is a
lack of transparency regarding trials capacity; lack of simple
co-ordination mechanisms for dealing with multiple trusts or research
centres; lack of standard practices when it comes to collaborating
with industrythough progress is being made in this area;
and lack of the business mentality required to conduct these trials
swiftly and to high quality standards. Medical consultants in
some of the existing trials units express frustration at the need
(as they see it) to solicit business personally and assist NHS
Trust R&D offices handling contract negotiations. There are
also clear infrastructure constraints: particularly a lack of
clinical research facilities and the necessary research staff
to support high quality execution.
42. The EU Clinical Trials Directive, which
came into force in May 2004, will substantially increase the managerial
burden of conducting trials, as regulatory measures that previously
applied only to late stage trials will now affect all clinical
trials of investigated medical product including Phase I trials.
Importantly, in an increasingly decentralised NHS, there is no
single organisation to champion clinical research and address
the challenges above. Bioscience 2015 recommended the creation
of a new organisational entity to fund and lead clinical research
in the UK, together with the creation of a national network for
clinical trials.
43. The Government responded to this recommendation
by setting up the Research for Patient Benefit Working Party (RPBWP),
under the Chairmanship of Professor Sir John Pattison, then Director
of Research and Development at the Department of Health. The BIA
welcomed the recommendation in the RPBWP's Report that a UK Clinical
Research Collaboration (UKCRC) be established, and the Secretary
of State for Health's subsequent announcement during the health
budget debate on 22 March 2004 of the Government's plan to implement
this, involving the NHS, patients, the Medical Research Council,
the Wellcome Trust, the medical charities and industry. The Secretary
of State has also announced that a network of paediatric centres
is to be established, that the mental health research network
be expanded, and an infrastructure is to be developed to facilitate
research into diabetes, Alzheimer's and stroke.
44. The BIA represents the bioscience sector
on the UKCRC Steering Group and values this opportunity to work
with Government and other stakeholders to develop the opportunity
presented by the creation of the UKCRC, current and future research
networks for the benefit of patients. Industry involvement in
the Steering Group is important in order to reflect the position
of industry as a leader in research and a prime sponsor of high
quality research.
45. It was also very positive that the Budget
earlier this year explicitly recognised this recommendation to
strengthen clinical research in the UK, and that funding has been
earmarked to take this forward. In direct recognition of the Bioscience
2015 recommendation, the Chancellor announced that NHS funding
for R&D will be increased by £100 million by 2008 and
the combined budget for medical research and for R&D within
the NHS will rise to around £1.2 billion a year by 2007-08.
(ii) Access to information on clinical trials
46. In order to ensure safety, efficacy
and quality of licensed medicines, it is reasonable that all clinical
trial data should be made available to the licensing authorities.
47. In addition, the BIA's Code of Best
Practice (please see next page for further details) points out
that Companies must establish their own formal procedures for
handling unpublished information which, if it were made public,
would be likely to have a significant effect on the price of its
listed or publicly traded shares or securities.
48. It is essential for the management of
these companies to build and maintain the confidence of investors
who rely upon projections and information about potential future
revenues from the research and development pipeline in valuing
the companies. Investors rely heavily upon these companies to
communicate information in a way that they can understand. Investors
also rely on analysts who interpret information emanating from
companies. It is therefore of the utmost importance that companies
constantly seek to apply best practice in their communications
policies and activities.
49. It is very important, however, that
the obligations a company has to release "financially sensitive"
information is handled in confidence where it arises. It is also
important that legal rights of companies are protected if misrepresentation
of data via the Internet or the media has taken place.
(iii) The BIA Code of Best Practice
50. The BIA's Code of Best Practice is mainly
concerned with how companies publish and communicate information,
particularly in relation to the development and commercialisation
of products, technologies and services. The Code applies to bioscience
companies that are members of the BIA.
51. The Code does not attempt to prescribe
in detail how companies should operate and it would be impractical
to try to do so. The Code contains general principles that BIA
members should observe. Member companies that are expected to
comply with the Code must report in the Directors' Report in their
annual report and accounts on how the principles have been applied.
They must also report on compliance with the provisions of the
Code and provide the reasons for any non-compliance.
52. The BIA wishes to act as a forum for
establishing and developing best practice. The Code does not replace
or override legal or regulatory requirements. It is designed to
supplement and reinforce the London Stock Exchange's rules and
guidancethe Continuing Obligations Guide and the Guidance
on the Dissemination of Price Sensitive Information.
V. REGULATORY
REVIEW OF
DRUG SAFETY
AND EFFICACY
(i) Making the case for innovation
53. The impact of overly restrictive regulation
has been covered already in this submission. There is a real risk
that this could adversely affect the health benefits that bioscience
products have the potential to deliver.
54. The introduction of novel therapeutic
approaches can lead to improved outcomes as well as reduced cost
of patient care for healthcare providers such as the NHS. Newly
launched products penetrate the UK market slowly relative to other
countries slowly as it isin 2000, only 16% of expenditure
on medicines in the UK was on new medicines (of those launched
between 1996 and 2000), compared with 25% in Germany, and over
33% in the US. The UK ranks above only Japan on this innovation
index. It also lags Italy, France, Australia, Switzerland, Spain,
and Canada.[64]
55. Bioscience 2015 stressed that the case
for innovation needs to be made, to signal the UK's receptiveness
to innovation and more assertively promote the advantages of technological
research and scientific progress. The report highlighted the weakness
of the precautionary principle that it does not allow account
to be taken of what constitutes an acceptable risk. Society is
generally poor at calibrating risk, eg patients suffering from
acute disease usually have a different view of safety thresholds
than healthy people. While innovation inevitably involves risk
and cost, it also offers huge potential benefit.
(ii) Creating a collaborative relationship
56. Bioscience 2015 highlighted the need
to create a collaborative relationship between the EU and UK drug
approval regulators and the bioscience and biopharmaceutical industry.
57. The report recommended that industry
should work with NICE, MHRA and EMEA to improve transparency in
order that MHRA, EMEA and industry engage early in the development
process to discuss which patient outcomes will be important for
subsequent acceptance. This should take place along the lines
of FDA-industry interaction.
58. It went on to recommend that MHRA and
EMEA should seek to at least match the FDA's target of reducing
drug approval times by 10%, and that the FDA, EMEA and MHRA should
also be encouraged to work closely together to ensure shared process
and protocols.
(iii) Research Ethics Committee approval
59. A thorough but efficient ethics review
process is central to the competitiveness in attracting clinical
research. The new system was simplified on 1 March 2004, but is
still slow.
60. A review is needed to look into actions
that could be taken to improve NHS Trust approval. Delays caused
by the R&D offices within NHS Trusts are probably the single
cause for most of the delays and the reason why industry conducts
trials abroad.
(iv) Making promising new treatments available
61. Drugs take 10-15 years to progress from
initial research through to on-market sale, and spend at least
three years in Phase III clinical trials and pre-registration.
In some markets, pricing and reimbursement decisions further lengthen
those timelines. Getting safe, innovative drugs to the patients
who need them, quickly, is a shared objective of both industry
and Government. However, more needs to be done to ensure early
access to life-saving medicines for patients.
62. The BIA would like to bring to the Committee's
attention a key BIGT recommendation to introduce a system for
provisional licensing of drugs, similar to the French Autorisations
Temporaires d'Utilisation (ATU) de cohort system. This would make
promising new treatments available to patients where a genuine
public health need exists, often before the completion of Phase
III clinical trials.
63. The system was introduced under the
French Social Security Code in 1994. It is an exceptional measure
for compassionate use of medicines, allowing the sale of drugs
that have not yet been granted a marketing authorisation. The
aim of ATUs is to provide early access to new promising treatments
where a genuine public health need existswhere there is
no alternative available. The diseases most frequently concerned
are cancers, infectious diseases such as AIDS, and neurological
disorders. ATUs are typically granted for drugs where there is
a strong presumption of efficacy against an acceptable safety
profile. This typically occurs at an advanced stage of clinical
development when, for example, a marketing authorisation application
is in the course of production or registration.
64. Drugs that received ATU status from
the French regulatory authority AFSSAPS are included in the list
of medicinal products approved for hospital use, thus permitting
reimbursement. Pharmacies of healthcare establishment are authorised
to purchase the ATU approved products.
65. The new EU pharmaceutical legislation
(Regulation (EC) No 726/2004) is a helpful step towards this,
laying the foundation for an EU-wide framework for compassionate
use of medicinal products in advance of authorisation and providing
the opportunity for Member States to implement a fast-track registration
procedure, conditional marketing authorisations. However, it falls
short of recognising that products supplied for compassionate
use are equivalent to authorised products for the purpose of reimbursement;
pricing and reimbursement fall within the national competence.
(v) Regulation of biosimilar medicines
66. A biologic is a medicine that can be made
only by using a living system/organism. Biologics have large,
complex, inherently diverse molecular structures. A so-called
similar biological medicinal product (a "biosimilar")
is a product that purports to be similar to a reference biological
medicinal product manufactured by an innovative biopharmaceutical
company.
67. Since biological medicinal products
are inherently different and more complex than small chemical
molecules, they must be approved under strict conditions to guarantee
patient safety. With the adoption of the EU pharmaceutical review
package earlier this year, the EU has established a regulatory
and legislative pathway for the approval of such medicines, together
with other, earlier adopted Directives and supporting EMEA guidelines.
In short this pathway states that contrary to what is required
for generics, the application for a marketing authorisation for
a biosimilar medicine must include appropriate pre-clinical and
clinical data, to establish safety and efficacy, on a case-by-case
basis.
68. Biosimilar medicines are not identical
or "substitutable" to the original product the way generic
drugs can be substituted, because they are not made from the same
parent cell or via the same manufacturing process, and thus cannot
be an exact copy or "generic".
69. Small differences in the production
process of biological medicines can yield vastly different products.
A faulty or imprecise "copy" of a biologic might appear
to be the same as the original product, but can cause extreme
side effects in patients and could raise serious safety concerns.
It is therefore right that the legitimate attempts to make and
market biosimilars should not compromise patient safety. The field
of biopharmaceuticals is a very new one. The first biopharmaceuticals
will be coming off patent very soon, paving the way for other
companies to copy these products and sell them. Now is the time
to get the definitions and the conditions right to ensure that
the products offered to patients are as safe, as efficacious and
of as high quality as the original products.
70. The system needs to ensure that what
the patients are getting is safe, but it also needs to ensure
that the emerging biopharmaceutical sector can develop. Safety
issues that might arise due to inadequate approval regulations
for biosimilars would damage the development of bioscience in
the UK and Europe. We therefore believe that a strict approval
procedure is necessary not only to guarantee patient safety but
also to protect the future of biotechnological innovation in the
healthcare industry in the UK.
VI. PRODUCT EVALUATION,
INCLUDING ASSESSMENTS
OF VALUE
FOR MONEY
(i) NICE
71. As outlined in Bioscience 2015,
there are concerns about how quickly drugs can be effectively
marketed in the UK after approval. Particular difficulties are
foreseen with new bioscience products. NICE has an emphasis on
mainstream drugs, whereas the bioscience industry often has niche
products where the patient numbers involved falls below NICE's
economic threshold. As a review by NICE of a new drug comes after
approval of that drug through the MHRA or EMEA and before its
availability to the NHS, it can be a barrier to diffusion. In
addition, nothing has been done so far to rectify the "postcode
prescribing", which is widely publicised, especially in the
oncology area.
72. Bioscience 2015 recommended that:
industry should work with NICE, MHRA and EMEA to improve transparency
in order that NICE is aware of clinical trials data at the earliest
appropriate moment for each individual company. NICE and industry
should engage in mutual educationabout, for example, which
drugs NICE will look at, NICE criteria for niche medicines/therapies,
and the best framework for evaluating total cost of care. In addition,
NICE should take full account of the wider economics of health
and social care when making decisions about the cost-effectiveness
of therapies.
(ii) PPRS
73. The PPRS is an agreement for the purposes
of Section 33 of the Health Act 1999. The objectives for the scheme
are that it should continue to:
secure the provision of safe and
effective medicines for the NHS at reasonable prices; and
promote a strong and profitable pharmaceutical
industry capable of such sustained research and development expenditure
as should lead to the future availability of new and improved
medicines.
74. An issue that has been raised with the
BIA by several bioscience companies in the context of the PPRS
is that of price modulation across portfolios. This related to
a mechanism whereby companies with portfolios are able to maintain
prices on individual products, providing that sufficient price
cuts are made on other products in the portfolio. The problem
that this presents for bioscience companies is that they are likely
to have a small portfoliooften one or two products.
75. Consequently, the option of making price
cuts across the portfolio is not open to them, putting them at
a significant disadvantage to larger companies with larger portfolios.
This is a definite disincentive for innovative, emerging companies
in the UK.
76. Moving forward, as more bioscience products
reach the market, not only will this issue affect a greater number
of bioscience companies, it is also likely that more issues specific
to the bioscience sector will become pertinent to the PPRS negotiations.
If these issues are to be fully discussedfor the benefit
of patients, the NHS, and the taxpayerrepresentation of
the bioscience sector needs to be ensured in future PPRS (or equivalent
scheme) negotiations.
52 All data from Critical I. Back
53
www.bioindustry.org/bigtreport Back
54
Biopharmaceutical drugs includes vaccines, all figures at ex-manufacturer
prices. CAGR (compound annual growth rate) for biotech drugs 15%
between 1997 and 2002 (Evaluate Pharma) vs 8% for total pharmaceutical
market (IMS Health). Forecast biopharmaceutical drug growth: 17%
CAGR 2002-07 (estimated from IMS Health 2003, Evaluate Pharma
2003, and analyst reports) www.evaluatepharma.com. Back
55
"In development" means Pre-clinical through Phase III.
Source: Pharmaprojects, March 2003 www.pharmaprojects.co.uk. Back
56
PharmaProfiles2003. Back
57
Critical I. Back
58
E&Y 2003. Back
59
Bioscience 2015, p 11, www.bioindustry.org/bigtreport. Back
60
Tufts. Back
61
Critical I. Back
62
Bioscience 2015, p 50. Back
63
http://www.dh.gov.uk/assetRoot/04/08/26/75/04082675.PDF. Back
64
ABPI, cited in Parexel's Pharmaceutical R&D Statistical Sourcebook
2002. Back
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