Pharmaceutical jobs and the end of R & D in the UK

As I was quite rightly told before I entered the industry, people will always be ill! In the early 1990's the British pharmaceutical industry was a cradle to grave affair with companies existing in drug discovery right through to the manufactures, sales and distribution of medicines to you, the patient via the supply chain.

There is evidence today that one key link in the chain is crumbling, and that is the Research and Development function ( R & D ). A decade ago, R & D was selling point boast about to potential employees, the amount of time and money being invested in R & D to produce a pipeline of new drugs to sell in the future. Today, this is perhaps no longer the case, so what has changed?

The process of drug discovery is, in itself, somewhat of a gambling game. You may start of with over a 1000 chemical entities to whittle this down to one which may have therapeutic effects worth testing further with the notion of use in humans. Even beyond this stage, the process of clinical trials is precarious, with many potential new drugs never getting past the early phases of clinical trials due to either adverse effects of the absence of the desired effects. To arrive at a drug which may be marketable can take up to 20 years from the start of the drug discovery process. The work and costs involved in the process are enormous, and concealed to all but those involved.

Even after drugs are launched for full usage many can go wrong often being withdrawn following the reporting of adverse effects from around the world. So often the population and media comment on the fat cats of the pharmaceutical industry and the money being made. However, the owners of pharmaceutical companies are having to play an elaborate betting game involving the balancing of the costs of drug discovery, clinical trials, sales and marketing against the potential revenue that comes in from the few drugs that do make it to market. And all of this needs balancing of very long time scales of over 20 years and beyond.

In recent years there have been a few key changes which may be pushing pharmaceutical directors beyond their comfort zone. In particular, two additional negative factors have been brought into the 'success' mix. Firstly, the PPRS scheme (The pharmaceutical price regulation scheme). This is a scheme whereby after the pharmaceutical company has made all of calculations encompassing risks versus potential profits over a 20 year period, the government intervenes every few years with an enforced price cut levelled at their discretion. Secondly, the introduction of NICE ( the National Institute of clinical excellence) as created a whole new level of risk which is totally immeasurable in advance. Having taken a drug from discovery to clinical trials through to commercial launch, NICE can still turn around and block the usage of the product and therefore remove the companies opportunity to recover some of their costs.

The net effect, the commercial attractions of R & D are significantly reduced. Many companies have taken their R & D overseas in addition to looking to gain commercial results elsewhere first where there are not the barriers to market entry. Many newer pharmaceutical companies are quite rightly considering their business model and changing the emphasis from medium and long term profit targets, to shorter and less risky targets. These decision are already having significant effects at ground level with such as medical sales, which are are declining in numbers to revert to short term profit models. Indeed, some companies are opting away from R & D altogether, simply looking to buy in products with established market positions, but potential to grow. This a lower margin proposition but also a lower risk approach bypassing the initial risks of clinical trials and NICE.

It may be too early to see the effects of the availability of new treatments to us, the patient. However, if present trends continue, there must be a price to pay at some point in the future.