Complex regulatory system causing decline in pharmaceutical industry
7 Feb 2011
The closure of Pfizer’s Sandwich Laboratory in the UK is part
of a long-term decline in drug development that has been affecting all
major pharmaceutical multinationals.
Big pharmaceutical companies have been downsizing, outsourcing and
merging in an attempts to find an innovation strategy that will keep
their pipelines filled with new, potentially profitable products.
This declining trend is blamed on a failure of innovative drive in
the industry, failure of the UK to support basic research, failure
of venture capital to invest in early stage research, or failure of
the National Health Service to provide smart procurement.
Research funded by the UK Economic and Social Research Council
(ESRC) shows that radical reform of the drugs industry regulatory
system must be an important part of the solution to ensure a
productive and profitable pharmaceutical sector, both globally and
in the UK.
Researchers from the ESRC’s Innogen Centre have studied the
innovation models in the pharmaceutical industry and how the
industry has been able to remain sustainable for so long. The
results of their research show that the lengthy and expensive
regulatory system that now applies to most products of the life
sciences is causing innovation failure.
Regulation has a large impact on the kinds of product that are
developed by any industry sector: it is designed to ensure that
products are safe, effective and of high quality. Innogen’s research
demonstrates that the impacts of regulation in pharmaceuticals are
more far-reaching: they determine overall company strategies; which
types of companies succeed; and ultimately the structure and
dynamism of the sector as a whole.
Under current circumstances regulation prevents the development
of the radically innovative technologies that could provide
opportunities for the sector to become more effective in developing
innovative products. Innogen's research has predicted that the
industry is approaching a tipping point in the not too distant
Professor Joyce Tait comments “We do not need less regulation,
but smarter regulation, that can deliver expected standards of
safety and efficacy, are flexible enough to respond to new
scientific discoveries and can do so more efficiently than our
current systems within a shorter time frame.”
Innogen's research also shows that policymakers and governments
need an understanding of all the major causes and relevant options
available. Radical regulatory reform for the life science industries
needs to be a priority in discussions regarding the future of the
industry. Reform could provide the lever to profitably unleash the
creativity that has been so effectively generated from public
funding of basic science, leading to something closer to the
innovative performance that we have seen in information and
communication technologies over the past twenty years.