Transcript Improving the competitiveness of the pharmaceutical industry

Improving the
competitiveness of the
pharmaceutical industry
Dominique Limet
Senior Vice-President and Area Director
Southern and Eastern Europe
G10 - recognising the need for a
competitive pharmaceutical industry
 G10 Recommendations: the end of a process or
the beginning of a change?
Pharmaceutical R&D
expenditure - a comparison
30000
1990-2001
€ million
26,384 (e)
25000
21,631
20000
18,800 (e)
17,495
Europe
USA
15000
10,958
10000
Japan
9,078
8,000
7,499
5,342
5000
5,221
2,810
n.a
0
1990
1995
(e): estimate
Source: EFPIA member associations, PhRMA, JPMA
2000
2001
R&D investment - driver of the
pharmaceutical industry
Research-driven pharmaceutical companies invest up to 14%
of their sales in R&D, which represents a higher percentage
than any other industrial sector
16%
Share of R&D (%)
14%
12%
10%
8%
6%
4%
2%
0%
Pharmaceuticals
Telecomms
IT
Electronics
Cars
Aeronautics
Services
Interm. goods
Consumer Goods
Agro-food
Petro-Chemicals
Media/Comms
Location of R&D spending by EU
companies
100%
90%
1%
26%
80%
5%
7%
1990-1999
26%
34%
70%
60%
Re st of the World
50%
USA
40%
73%
30%
EU
69%
59%
20%
10%
0%
1990
1995
Year
1999
Source: EFPIA, 2000
A call for Action
A competitive environment: key to a thriving
pharmaceutical industry in Europe
 Competitive pricing for non-reimbursed medicines
 Benchmarking for competitiveness
 Principles of the Transparency Directive are key in finding

solutions to accelerate market access
Transparency and predictability in Health technology
assessments
The importance of pharmaceutical
competitiveness for Europe
 A knowledge-based economy
 Provision of high-skilled jobs
 Driver for innovation and investment
 Provision of medical advances
Drug discovery is a high-risk process
Attrition is High in the R&D Process
~100 Discovery Approaches
Millions of
Compounds Screened
High Risk Process
Preclinical
Pharmacology
12 - 15 years
Cost of development +800 Mo
euro on average
Preclinical Safety
1-2
Products
Clinical Pharmacology
& Safety
Discovery
Exploratory Development
Phase I
0
Idea
Full Development
Phase II
Phase III
10
5
12 - 15 Years
15
Drug
Our investment in R&D is a reflection
of a high-risk development process
1000 Estimated full cost of bringing
a new chemical or biological
800 entity to market- € million
600
895
400
572
200
187
307
378
1993
1997
0
1991
Note:
1999
2001
Data have been expressed in € million at current exchange rates - Original data in $ million: 231 (1991), 359 (1993),
429 (1997), 610 (1999), 802 (2001)
Source: Di Masi J. et al., Tufts University, 1991; Office of Technology Assessment (OTA), 1993; Myers and Howe, 1997;
Office of Health Economics & Lehman Brothers, U.K., 1999; Di Masi J., Tufts University - Centre for the Study of
Drug Development, 2001
Current and future profile of
pharmaceutical innovation
50%
40%
30%
products launched
20%
products in
development
10%
0%
small medium
large
very
large
Comparison of product portfolios launched and in development (from 35
companies - source LEHMAN - BROTHERS) on the basis of size of
targeted populations in OECD markets
Stimulating research into new
medicines
Pharmaceutical industry R&D investments - 1962-1996
The pharmaceutical industry’s
investment in the life-science sector
Imclone
Otsuka
Erbitux
Sepracor
apipriprazole
Nistat
BMS
Oncology apipriprazole
therapeutic
Network
Azactam
Garenoxacin
Dura
Toyama
ALZA
Pfizer
Viracept
Prinomastat
Agouron
Picovir
Karo Bio
Combipatch
Noven
Kyorin
ViroPharma
Obesity product
Exubera
Strat. All.
Aventis
Genasense
Therion
CRCT Ltd.
PARP Inh.
Millenium
Technology
transfert
Alvac
Remune
Axys
Helico...
IPL512602
Genta
Peptide therapeutics
cathepsin
Dynepo
Unigen
Oral Calcitonin
Denspm
Allerga
Campto
Transkary
otic
Delivery System
for Procardia XL
for Glucotrol
SunPharm
Response
Avapro
Japan
Inflazyme
Kos
Yakut Honsha
Zyrtec
Zithromax
Singulair
Japon
Noroxin
Phytopharm
Reactine
Inhale Therapeutics
Pliva
UCB
Yuhan
Shionogi
TR 14035
S 0139
Taisho
FIC
Légende
Licensing-in
Co-Promotion
Joint Venture
Co development
CRF Pgm
Alvimopan
Delivery system
repifermin
GSK
GR270773
Oral Insulin
Scios
Bany
Bexxar
Oral hormone
Coutler
adefovir
Epivir
Combivir
Trizivir
Matastron
Nobex
Texas
Biotech
GLX
Zomig
Shire
device
AstraZeneca
Cytokinetics
Iressa
Relenza
Unigene
Oxis Tubuhaler
Matastron
Vertex
Argatroban
MPL
Immunogen
Biogen
HGS
Agenerase
Tuberculose
Prostate
Chlamydia
SB 408075
Natrecor
EU
KRP 297
Sepsicure LLC
S 8510
Zyban
Japon
Niesseria Vaccine
Her-2
Sibia
CRF Pgm
GW810781
Mammaglobin
Corixa
S 1746
Pralnascan
Powderject
SIB 1508
SIB 1553
Merck
Anti VLA
Alkermes
Neurocine
Biosciences
Adolor
Tanabe
Claritin
SGP
Sugen
AZD3582
NOSAID-II
NIcOx
pulmicourt
SkyePharma
Relenza
Gilead
Etat des liens que les 6 plus gros labos phamaceutiques ont tissés
Au 7 Juin 2002
Increasing competitiveness: a dual
approach
 Meeting the pharmaceutical sector’s needs:
– Rewarding innovation and improving the
science base
– Addressing structural issues
– Improving market access
Creating the right conditions for a competitive
industry
Increasing competitiveness: a dual
approach
 Meeting society’s health objectives:
– Bringing innovative approaches to healthcare
– Addressing health gaps and priorities
Operating in a manner that responds to Europe’s
health needs
Europe’s ageing population
United Kingdom
France
Germany
um
lgi
Be
ia
str
Au
15
Finland
Spain
Sweden
Netherlands
Italy
United Kingdom
10
Denmark
Spain
5
France
ria
st
Au
Average expenditure per head expressed as a share of GDP per capita
(%)
20
0
0-4
5-9
10-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85-89 90-94
Age groups
Source: Economic Policy Committee (2001) “Budgetary challenges posed by ageing populations”
95+
The limits of cost-containment
 An increase in pharmaceutical spending largely
due to ageing and the launch of innovative
medicines
 Pharmaceutical spending is an easy target but only
represents a part of overall healthcare spending
 A continuous focus on short-term cost-containment
will not resolve long-term structural issues and
challenges of healthcare systems in Europe
Avoiding the vicious circle
Budgetary pressures
Healthcare
rationing
Ad hoc emergency
measures
short-termism
Access delays
Pharmaceutical industry
must take measures to deal
with abrupt changes
Less access for patients to
innovative treatments
Higher costs in other healthcare
budget silos, i.e.hospitalisation
Renewing the ‘social contract’
R&D investment in medicines
that count
Recognising the benefits of innovation
Business Planning for
long-term supply of
medicines
Ensuring access for patients to
innovative treatments
Predictability,
communication,
transparency
Optimising healthcare
intervention
Managing healthcare budgets
Next steps
 Cost considerations are key
 Long-term value is critical
Balancing the relationship to ensure that
European pharmaceutical industry meets
Europe’s needs in a changing world