Europe leads global drug discovery: Study

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New data shows that Europe is ahead of the United States in pharmaceutical research productivity, contrary to conventional wisdom, argues Professor Donald W. Light in an article published recently in the journal Health Affairs.

on Donald Light, a visiting professor at Stanford University, claims a “re-analysis of data” from of new drugs released between 1982 and 2003 “contradicts the claim that US drug firms overtook European firms in pharmaceutical innovation”. 

This view goes against arguments that a fragmented patent market and duplication of research are holding back EU competitiveness in the area of research and development (R&D) (EURACTIV 10/03/09). 

There have also been concerns about anti-competitive practices by big pharmaceutical groups stifling the innovation and competitiveness of drug research in the sector (EURACTIV 17/01/08). 

The share of drug-related R&D funding in the US and Europe has changed markedly over the last few decades, Light argues. In 1990, Europe accounted for half of total spending on R&D in Japan, the United States and Europe, whilst America spent a third. By 2000, America’s share had increased to 48%, whilst R&D funding in Europe had decreased to 37%. 

However, this change in spending has not been reflected by a greater quantity and quality of drug discoveries in the US, maintains Light. In terms of productivity, measured by the number of new drugs discovered in proportion to funding, Europe shows “greater and increasing research productivity,” whilst overall US productivity has declined. He adds that in America in particular, many of the new drugs brought onto the market had little added medical value over existing medications: “In short, commercial success is often distinct from therapeutic importance.” 

The news comes as a surprise in the EU following previous reports that EU expenditure on R&D has been falling behind that of the United States, hampering the bloc’s aim of becoming the world leader in research and innovation (EURACTIV 10/02/09). 

The EU has taken some steps to boost pharma industry research, including allocating €2 billion of funding to improve the speed of new drug development (EURACTIV 05/05/08). 

The recent article concludes there is “strong, general evidence that US firms have not overtaken their European counterparts in pharmaceutical innovation,” and, going even further, that “given the new institutes in European countries […], returns on R&D investment in Europe may increase in further during the next decade of 2004-2014”. 

In terms of policy implications, the professor reflects that “lower European prices seem to be no deterrent to strong research productivity,” good news for those in the US concerned about the price of new patented drugs. 

Ken Johnson, senior vice-president of the Pharmaceutical Research and Manufacturers of America  (PhRMA), was defensive in response to Professor Light's findings, saying: "Unfortunately, the paper paints a distorted picture that gives short shrift to the medical advances made possible by America's pharmaceutical research and biotechnology companies." 

"America leads the world in discovering and developing innovative medical therapies," he claimed, adding: "European leaders' embrace of ill-conceived public policies – including government price controls and sluggish regulatory decision-making – [have] chilled innovation on that continent and raised doubts among private investors who help to underwrite research." 

The European Commission's view, published on its website, is that "despite the strength of the industry, Europe has not been able to maintain its leading role as a pharmaceutical centre". It reports that "in 1992, six of the top 10 biggest selling medicines in the world originated in Europe and four in the USA. In 2005, the situation had reversed, with seven of the top-selling medicines coming from the USA and only three from Europe". 

Last year, the European Commission launched an investigation into the pharmaceutical sector. 

A damning preliminary report, published in November 2008, alleged that anti-competitive practices in the sector were hampering innovation and blocking the entry of cheap generics onto the European market (EURACTIV 28/11/08). 

According to the November report, big pharma firms were applying for multiple patents for the same medicine and seeking to prevent competitors from developing new drugs. 

The final report, published in July 2009, was softer than the preliminary version, with EFPIA, the trade group representing large pharmaceutical companies, highlighting a shift in tone and welcoming the Commission's "constructive policy recommendations" (EURACTIV 9/07/09). 

The pharma group said the final report "failed to substantiate" earlier allegations that patenting strategies threaten innovation and illegitimately delay the entry of generics onto the market. 

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