Introduction – 70 years
Ladies and gentlemen.
Welcome to the 2018 ABPI Annual Conference. A special year as both we and the NHS celebrate respective 70th anniversaries.
A moment to reflect on amazing achievements together.
A moment to focus on the incredible possibilities in our future together
And a moment to look at the potential for the patients we both serve.
Seventy is a number that resonates for all sorts of reasons. In the Bible in Psalm 90, Verse 10, it says: ‘The days of our years are three score years and ten’. So, the Bible allots us seventy years. Yet today we would feel somewhat short changed if we only lived to seventy.
Since I was born, life expectancy in the UK has increased by over a decade. And that of my children by a further decade on top of that. For my children to be expected to live to 90, or even a 100, is astonishing.
This week I was at the official opening of the Cell & Gene Therapy Catapult in Stevenage, of which we will hear more from Keith Thompson later this morning. In his speech, Greg Clark, Secretary of State at BEIS stated that there are 15,000 people today who are over 100 years old, but that of the total population living today, ten million could expect to become centurions. That does make you stop and think! We are an industry heavily focused on improving outcomes, and here we are confronted with extraordinary gains in years of life.
Of course, this creates new challenges from pension provision to the need to address healthy ageing. That’s why ‘Healthy Ageing’ is one of the Grand Challenges we’ve set ourselves to tackle in the Industrial Strategy. But for those who only see downsides and problems in all this, I remind them that the alternative is much worse.
Future of the Life Sciences Industry
It is truly a great time to be alive and it’s a great time to be working in UK Life Sciences. Today, this country has the third largest bio-pharmaceutical cluster outside the East and West Coasts of America. This puts the UK as world leaders, as our industry brings the next generation of medicines to patients.
Twenty years ago when I joined our industry, I was schooled never, never ever, to talk about cures to avoid setting false expectations. Today we clearly can talk about cures in some disease areas. And others, like HIV, which were seen as death sentences, we now look at them as having the characteristics of a chronic disease.
Even with Cancer, people are twice as likely to survive at least 10 years after diagnosis than they were in the 70s. And this in a disease area where the UK lags behind most other developed nations in the outcomes we deliver.
As previewed on the screens around the room, I hope that you will enjoy the virtual reality experience that showcases the exciting future of medicine.
That’s why in the first section of our conference we’ll look at the impact of our innovation on the NHS and on millions of patient lives.
And look forward to the pioneering delivery of cell and gene therapies and how technology is changing what patients should expect of us and how it is changing what we aspire to achieve in this country. To make the changes needed for the continued provision of word class healthcare, free at the point of delivery, to everyone.
In the UK, Healthcare is delivered by a complex public/private ecosystem, and that public/private interplay is why we were convinced that an Industrial Strategy was the right approach for our industry.
We all worked closely to support Sir John Bell in developing the strategy, and industry has already shown its support for the delivery of the strategy through the first sector deal – and we expect to deliver a second sector deal later this year.
With such wide-ranging support from our Industry it was no surprise that the Government decided to launch its own cross-sector Industrial Strategy white paper at The Crick.
As an industry we know that there is a triple win that we need to work hard to keep in focus. A win for patients with improved outcomes, a win for the NHS with system efficiencies and a win for industry with a greater and faster uptake of our innovation.
We all need to be honest with ourselves that there is more we can do together. In the UK we are not the best in the world today. Outcomes in many disease areas don’t match neighbouring countries.
Tessa Jowell’s commitment to improving this situation has been as emotional as it has been inspirational.
The Government responded to her campaigning. But Parliament has taken on board the fact that she still had to travel to Germany to get the treatment she needed. All patients and voters expect us to do more, and all stakeholders need to ensure we live up to their trust in us.
So, the conversation around the Industrial Strategy has created an implicit understanding that we can do better.
Tessa Jowell has done something more. She has become the first person to donate her data to a global cancer data base. Later this morning Chris Carrigan from the organization ‘Use MY Data’ will guide us through the important issues involved in this.
Business Model and PPRS
I want to move on to give a perspective as we embark on discussions to agree the next five years framework agreement with the government, known colloquially as the PPRS, where the industry is committed to look for the triple wins.
Our business model is both simple and incredibly challenging. We borrow money from investors to fund the difficult search for new medicines. And it is difficult! Most scientists never work on a medicine that gets to market in the whole of their careers.
If we get a scientific breakthrough, it still requires incredible capability to turn that into a medicine. If we are able to discover something, we get a patent for 20 years. It requires an equal amount of ingenuity and investment risk to turn that scientific breakthrough into a medicine. By the time we have achieved that we typically have 10 years left to get a return on all the investment.
Since we must publish our patents, other companies pour over these and often use them to initiate their own research programmes. This results in multiple efforts which increases the chances of more medicines making it to market. But reduces the likely number of patients for any one of the medicines, and hence reduces the return.
The price charged when the medicines are launched still need to be fair prices and the UK has NICE to ensure that medicines are both cost effective as was as clinically effective. But when they go off patent, generics are free to enter the market, normally made by other companies, and prices for medicines in the UK tend to fall significantly.
When I joined the industry, statins were the latest innovation break through – playing their part in mortality for Heart Disease decreasing by 75% since 1961. With genericisation, we now see the cost of a month’s supply of statins being less than the price of a cup of coffee at Starbucks.
If you think about our business model you will understand how challenging and fragile it is. And why the early years of the launch of a new innovation are so critical. Yet it is precisely at this point that the UK puts up the most barriers. For the first time I believe that this message is understood, and there is a genuine commitment to finding a solution. The outcome of the next PPRS negotiations will signal our collective ability to resolve this.
There is an imperative for all stakeholders to work together to find the triple win. This afternoon we will see and hear how we have been working with the NHS in Manchester to find that triple win. The NHS in Manchester has recognised the power of its own data to be transformational in its delivery, and how by working together we can achieve so much more for patients. It sets up our President and Simon Stevens, CEO of the NHS, to discuss later in the Conference how we can leverage this as we look forward to our next 70 years together.
Turning to Brexit. I don’t know what the outcome of the Brexit negotiations will be. I do know that the fundamentals for the industry remain incredibly strong in the UK. We are a nation of inventors and we have a country and a culture where the best in the world want to come and co-create together. The quality of the science coming out of The Crick after just two years is more exciting than anything else seen across Europe.
The UK government has already made a generous offer to continue to co-operate with the EU. Something I believe is in the best interests of EU’s patients and the EU’s life sciences ecosystem too. Why would you cut yourself off from the UK cluster?
As an industry we accepted the referendum decision of the British people and threw ourselves into making it work. We drew on over 200 of our global experts working in six different work streams to come up with our four key issues of Regulation, Trade, Investment in Science, and Movement of People. These issues have stood the test of time, and we have had joint work groups with the Government, and with great support from the Office of Life Sciences, ever since.
The UK Government have been excellent in their response. Jeremy Hunt and Greg Clark wrote a letter to the Financial Times as early as last July to lay out that, in the best interests of patients and public health across Europe, the UK Government wished to maintain cooperation with the EU on medicines.
This culminated in the Prime Minister’s Mansion House speech where she called out Pharmaceuticals as one of the three sectors which would be a priority for the UK Government to maintain cooperation. This clarity of intent is hugely welcome and appreciated.
And with The Labour Party also announcing that cooperation on medicines regulation should be a priority for the negotiations, Government and Opposition are sending a clear signal to the EU.
We also have political agreement for an implementation period for Brexit – between March 2019 and December 2020. Crucial for us an industry to have a chance to reengineer our complex supply chains.
However, what is also clear is that this period is subject to the agreement of the final Brexit deal.
Right now, the legal guidance from the EMA website has not changed and remains that companies should prepare for the UK being a third country from March 2019, if an implementation period is not agreed, and December 2020 if one is. The EMA’s position is that, until there is political agreement otherwise, the industry needs to be ready for Brexit. Until political agreement becomes legally certain, it is the only position they can take, unless politically guided otherwise by the EU. And they are not being.
The consequence of this is significant. Companies need to collectively invest hundreds of millions of pounds to duplicate systems such as batch release testing, which will be essential in the event of no agreement, but unnecessary if cooperation is agreed in the final deal.
I recognise the frustration and financial pain that this creates. But my message remains the same as the one I gave in December last year. Companies must continue to invest and prepare.
As an industry we have incredibly long and complex supply chains, perhaps only matched by the incredibly long and complex political negotiations involved in Brexit.
As businesses we are schooled to make early decisions and plan ahead; whereas politicial negotiations tend to result in agreements at two minutes to midnight. Listen to the mantra – ‘Nothing is agreed until everything is agreed’
So, as we continue to work closely with Government for the best outcomes for patients and industry, we must continue to prepare for all eventualities.
I’m sure that there will be questions on this, so I will join the panel after we have heard from Baroness Fairhead, our Minister of State for Trade and Export Promotion. And Nathalie Moll my counterpart who is the Director General of EFPIA, our trade association in Brussels.
So finally, when we look at the incredible pace of change in our scientific insight; and the opportunities through the Industrial Strategy and through Brexit; I believe we are incredibly lucky to be the generation going through such seismic change.
And when we come together to celebrate the ABPI and the NHS’s 70th birthdays it will then be clear to all to see how it has played out.
Was it a point where we were able to take a step back from the fray in the UK, and use the change happening around us to harness the science and patient data to deliver further significant health gain, and health system gain, in the UK?
Were we able to align the industry’s business model and the model of the NHS and create something that delivered the ambition in the Life Sciences Industrial Strategy and saw the UK become an even stronger epi-centre of science and innovative health-care?
I’m privileged in my role to have multiple insights into our amazing ecosystem, and I believe, with strong political and sector leadership and with everyone’s support from the organisations here in this room today, we can, and we will.
Just look at the profile of this sector today. And think about what we have yet to deliver. The mission is clear. Truly, this is a time of great opportunity, which we must not waste.
The ABPI represents innovative research-based biopharmaceutical companies, large, medium and small, leading an exciting new era of biosciences in the UK.
Our industry, a major contributor to the economy of the UK, brings life-saving and life-enhancing medicines to patients. We represent companies who supply more than 80 per cent of all branded medicines used by the NHS and who are researching and developing the majority of the current medicines pipeline, ensuring that the UK remains at the forefront of helping patients prevent and overcome disease.
Globally our industry is researching and developing more than 7,000 new medicines.
The ABPI is recognised by government as the industry body negotiating on behalf of the branded pharmaceutical industry for statutory consultation requirements including the pricing scheme for medicines in the UK.