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Drug Discovery and Development: the Role of the UK and Europe as a centre for R&D and Innovation

Malcolm Wicks MP,  Minister of State for Energy
Drug Discovery Technology Europe 2007 - Novotel, Hammersmith, London,  13 March 2007

Thank you for inviting me here today to offer my thoughts on the role of the UK and Europe as a centre for R&D and Innovation. It is timely.

As the PM said when he opened Amgen’s new European Development Centre in Uxbridge a week or so ago, “now is the moment for a big push in improving the environment for the bioscience here industry in the UK”.

Europe has a mountain to climb. Whether we view globalisation as a threat or an opportunity, it is clear that the climate in which policy is formed has changed dramatically since 2000, when European leaders met in Lisbon and set themselves the ambitious target of making Europe the most dynamic and competitive knowledge based economy in the world by 2010.

For most of the post-war period, Europe could pursue its own economic and social policies, without over worrying about its international position. Its achievements were remarkable: peace and prosperity in a continent that had been nearly destroyed by war twice over.

But today, Europe can no longer afford to look inwards and back to its past achievements. The volume of world trade has grown twenty-fold since 1950. The World’s stock of Foreign Direct Investment has grown thirteen-fold since 1980. And emerging and developing countries have increased their share of world trade by a third since 1990.

Europe needs to adapt to the changing balance of global economic activity, and the rise of fast-growing economies, like China and India and other economies too. At a time in our history when the stock of scientific knowledge is doubling every five to seven years, India produces more science graduates each year than the whole of the European Union. In 2004, China and India produced 125,000 computer science graduates; the figure for the UK was 5000. China has tripled its spending on R&D over the last five years; and India plans to quintuple the size of its biotechnology sector over the next five.

But let’s not forget that, even if China does overtake the US and become the world’s largest economy in 2039 thereabouts, as Goldman Sachs has predicted, the US remains formidable, out-performing the European Union in nine out of twelve innovation indicators, including patents, tertiary education, Business Research and Development expenditure and early stage venture capital.

This is why it is of paramount importance that the Lisbon Agenda achieves the goals we have set for 2010, and why it is important that we continue to focus on these issues at international conferences. Serious challenges need to be addressed if we are to make Europe once more the leading global centre of innovation in drug discovery.

It is vital for the future of Europe that we have structures in place that promote high quality research, and most importantly, help to ensure that this high quality research feeds though into the wider European economy to improve the competitiveness of our industrial base. In particular, it is vital that the Framework Programme is driven by its “users” – primarily businesses that are in a position to exploit the outputs of research.

The next Framework Programme has two basic tasks – strengthening Europe’s research base and providing mechanisms to support the translation of discoveries into products that will enable Europe’s companies to compete and thrive in world markets.

This needs to be attractive to companies of all sizes. I know that companies have been put off by contractual issues and the general bureaucracy involved in participating, but we are addressing these issues, and actively encouraging SMEs to get involved.

In addition, there are proposals for new and innovative funding mechanisms – such as the Joint Technology Initiatives. Of these, the UK regards the Innovative Medicines Initiative as one of its top priorities. I welcome the involvement of the UK and European pharmaceutical industry in developing the IMI proposal and sharing the responsibility for funding it. Its aim is to develop clear and practical paths to accelerate the development of safe and more effective medicines using joint public private partnerships. We believe this initiative offers a great and unique opportunity that will enable Europe to strengthen its research base and galvanise the relevant stakeholder groups in a way not possible under any other mechanism, and help to ensure that progress in this important area is shaped by the EU as well as by the US Food and Drug Administration’s Critical Path Initiative.

Turning to the UK as the biopharma leader in Europe, we fully recognise our role in helping to shape the future of this industry here in Europe. The Government is committed to creating the best possible conditions for companies to innovate, grow, and be profitable. That is why the Government introduced the R&D tax credit and has increased spend on the science base in our universities. But we are well aware that in order to maintain and improve the environment here for research, development and manufacturing we must build on the UK’s strengths and work to reduce and remove the barriers to growth. We are also acutely aware that business is global, and that investment decisions are made on a global basis. The UK needs to continuously improve its appeal in the face of growing competition from other countries.

I believe that we have in the UK the key ingredients for success: a world-class science base, the best venture capital industry in Europe, experienced and entrepreneurial managers, and an outstanding record of drug discovery and development. It is not by chance that 18 of the world’s 100 top-selling medicines were discovered and developed in the UK, a share second only to the US.

Our Universities, research institutions and industry all contribute to produce highly skilled bio-scientists and chemists. We know that access to staff with the right skills and knowledge is a key priority for both the bioscience and the pharmaceutical industries.

The UK also has a good story to tell on the flexibility of our labour market in general. The OECD has shown it to have the least regulated and most adaptable labour market in Europe. This ensures that people have the opportunities to work, business can find the right people, and respond speedily to changes in markets and consumer preferences.

Regulation must be science based and strike the right balance between promoting innovation and addressing public concerns. It is crucial that society and government clearly understand the issues and set the framework within which the life science industries can innovate, be competitive and develop effectively.

The UK Government believes that by adapting legislation and regulations to changing circumstances we can provide a favourable environment for R&D. One example is the on-going research into stem cells. A considered, balanced, but proactive approach to regulations in the use of embryonic stem cells has put Britain a leading position internationally, attracting top scientists in this area. We have set up a National Stem Cell Bank, which further enhances the attractiveness of the UK for stem cell research. This Bank provides a key facility for research by providing a supply of stem cells and a framework for the controlled and ethical use of stem cells.

The Government has also put considerable funding into areas like biopharmaceutical bioprocessing, regenerative medicine and biomarkers through the Technology Programme, all of which play an important role in the drug discovery process.

I also strongly believe that one of the key ingredients to maintaining the UK’s attractiveness is the ability of industry and government to forge a genuine partnership in support of the shared goal of building on the UK’s strengths and reducing barriers to growth. A partnership that is genuinely two-way, where the views of industry are both heard, and acted upon. There is room for improvement and I am looking forward to your views on this.

Looking back over the last few years I am pleased with the progress we have made. The setting up of the Pharmaceuticals Industry Competitiveness Task Force was an important step that provided a structured action-oriented platform for effective high-level dialogue between Government and the pharmaceutical industry. It strengthened industry-Government relationships, significantly increased mutual understanding and delivered some valuable outputs.

It in turn led to the formation of the Ministerial Industry Strategy Group that has recently published a long-term leadership strategy for the UK. This aims to further improve partnerships between the NHS and the pharmaceutical industry here in the UK, to streamline the drug development process while protecting patients and to support the aims of the European Commission’s Pharmaceutical Forum to improve competitiveness across Europe. Sir David Cooksey’s recent report on health research funding has also been welcomed by the Government, including his ideas on speeding the process of drug development and licensing. The recommendations of this report will be taken forward through the MISG.

Finally, I want to mention a key priority in terms of creating the right environment for success, which is putting an end to the harassment of researchers, by the animal rights extremists.

It is unacceptable that researchers are hampered in their vital, lawful and highly-regulated work by the criminal activity of a tiny minority of extremists. The Government has repeatedly stated its commitment to defeating animal rights extremist activity that falls outside lawful protest, and we are delivering on that commitment this year, and intend to continue for as long as the problem exists.

There are challenges before us, which if left alone, may hinder the development of the European bioscience and pharmaceutical sectors. It is our job to work together to identify solutions to ensure that these sectors continue to grow and play a major role in the economic prosperity of the European Union and the global market. I very much look forward to discussing these issues further in the panel session to follow. Thank you.