Proposed tax credits for R&D welcomed
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"Tax credits for R&D are a welcome proposal, but sadly,
this initiative alone is unlikely to result in a major increase
in investment in New Zealand by the researched-based pharmaceutical
industry," Lesley Clarke, CEO of the Researched Medicines
Industry Association (RMI), said in a submission on the
Business Tax Review.
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"Most major R&D investments by international pharmaceutical
companies are determined at a global level, often with local
operations in several countries competing for projects.
"Unfortunately for many pharmaceutical companies the fact
that the New Zealand pharmaceutical management system actively
works to devalue innovation will continue to be a key barrier
to such investment unless the planned National Medicines
Strategy introduces some meaningful reforms.
"The difficult and uncertain commercial environment in which
the industry has operated for more than a decade has had
a deleterious effect on R&D. Many companies have disinvested
infrastructure and the level of New Zealand based research
and clinical trials has fallen," Ms Clarke said.
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Valuing research and innovation
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"Why is government ignoring the benefits and
opportunities offered by R&D and biotechnology in the pharmaceutical
sector," asked Dr Pippa MacKay, the chair of the RMI.
"A conservative estimate of global pharmaceutical R&D spend
per year is $NZ80 billion, and New Zealand really should
have a slice of this.
"If New Zealand were to attract 0.25% of this international
pool, which with local management and a robust local industry
should be obtainable, it would equate to around $200m, or
nearly ten times what is spent now by pharmaceutical companies,
and nearly triple what the government spends on biomedical
research."
Dr MacKay said the Growth and Innovation Framework and the
Biotechnology Strategy offered so much potential. But it
looks like it has dropped off the political radar as far
as pharmaceutical opportunities are concerned," she said.
The benefits are varied and far reaching.
The research and development of new pharmaceuticals has
a positive effect on providing access to new innovative
therapeutic products, the process itself offers benefits
to patients, clinicians, health institutions and the government.
For instance a patient enrolled in a clinical trial may
gain access to a novel medicine often years in advance of
when the medicine will be registered and otherwise commercially
available.
With life-saving and life-extending medicines, such as new
oncology developments, this time advantage has significant
personal and societal value.
Clinicians also benefit from gaining early experience with
new treatments. Hands-on clinical experience offers insights
that can't be got from conferences and medical journals.
"The higher the level of clinical trial activity in New
Zealand the more clinical leaders we will have across therapeutic
specialities," Dr MacKay noted.
The final major benefit is savings to the participating
DHBs' budgets.
When a patient is enrolled in such a trial the pharmaceutical
cost, both the trial medicine and any comparator treatment,
is met by the sponsoring company. And, in the majority of
cases all associated treatment costs and overheads are also
covered.
A recent report by Dr Edward Watson of Nazadel Ltd * showed
that around the world there are currently over 1000 pharmaceutical
trials underway; many in areas of interest that the New
Zealand government has targeted as priority diseases.
In the oncology area there are nearly 300 products that
target various cancers currently in clinical development.
Dr Watson found that unfortunately hardly any of the companies
involved with those products perform research in New Zealand.
There is also an increasing trend that if the company can
not envisage obtaining reimbursement for a product in a
country then they are reluctant to perform research there.
*Source: Pharmaceutical Research and Development in New
Zealand - On the Brink of the Abyss, by Dr Edward Watson,
Nazadel Ltd, Biotechnology and Pharmaceutical Consultants.
May 2006.
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If you think research is expensive, try disease. Mary Lasker
(1901 - 1994)
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418
biotechnology medicines in development
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Pharmaceutical and biotechnology companies are pushing
the frontiers of science to bring more and better treatments
for patients. Millions have already benefited from 125
medicines and vaccines developed through biotechnology
and there are a further 418 medicines in development for
more than 100 diseases in the US alone.
These include 210 medicines for cancer, 50 for infectious
diseases, 44 for autoimmune diseases and 22 for AIDS/HIV
and related conditions. These medicines are either in
human clinical trials or under review by the USFDA.
Approved biotechnology medicines already treat or help
prevent heart attacks, stroke, multiple sclerosis, leukaemia,
hepatitis, rheumatoid arthritis, breast cancer, diabetes,
congestive heart failure, lymphoma, kidney cancer, cystic
fibrosis and other diseases.
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Aussies
getting it right, again?
The last round of funding applications for the Australian government's
Pharmaceutical Partnership Programme (P3) was advertised earlier
this month.
Applications for the final round of funding under the $150m programme
were called for, with grants up to $10m being made available to
those companies that commit to spend on R&D to benefit the Australian
economy.
After consultation with industry, the government has offered an
increased payment rate of 50 cents in the dollar for each dollar
spent above an R&D investment threshold on an agreed portfolio
of R&D activities in Australia. Industry Minister, Ian Macfarlane
said "a stronger emphasis on partnerships will provide even greater
incentive to pharmaceutical, generics and biotechnology companies
to benefit from Australia's world-class health and medical research
capabilities."
Medicines Australia, the RMI counterpart, said "partnerships with
global pharmaceutical companies are a recognised and proven path
to the global market for Australia's world-class health and medical
research community."
Dr Pippa MacKay said that forward thinking like this had resulted
in the development of a very substantial manufacturing sector
as well as a thriving R&D capability.
"Indeed, this very foresightedness has resulted in pharmaceutical
exports being the third largest export earner for Australia."
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Belgian 'Kiwi Lite Model'
Belgium has recently introduced changes to its pharmaceutical
system reportedly based on the NZ model where, following a public
tender, only the cheapest product is reimbursed.
However, according to an analysis by Marc Martens, a senior associate
at international law firm Bird & Bird's Brussels office, the new
Belgian reimbursement model "can only be defined as the 'light(est)'
version of the New Zealand system, considering the fact that
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Belgian reimbursement is not limited to the
product with the lowest price (winner takes all) but it
is differentiated |
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It is not generalised but will only be applied
for specific products and be justified by budgetary reasons |
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It is not applicable to products under patent
protection." |
| This just goes to show that the one country who had looked
favourably on the PHARMAC model ultimately rejected the
majority of strategies and processes it uses. |
Source: EURALex - European Heathcare Law & Regulatory News,
28 July 2006. |
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