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European R&D investment "stagnating"

Report says health research spend was flat in 2011

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Spending in the EU on health-related R&D tailed off in 2011 after decades of annual increases, according to a new report.

The pharmaceutical and related industries spent some €29bn on R&D in 2011 - around the same level as the previous year - while public investment by the European Commission and member states dipped 1 per cent to €18bn, says the study.

The report notes that this level of stagnation is actually a little better than has been seen in the US, although the latter has a much higher level of R&D spending at around €91bn a year.

The decline is attributed to "the current economic situation, reinforced by the uncertainty about future market conditions, and increasingly limited reward mechanisms for innovative technologies, amongst others", according to the study, which was commissioned by Janssen Pharmaceutica and carried out by Deloitte Health Economics.

Germany led the pack in terms of R&D investment at €9.4bn in 2011, followed by France (€8.3bn), the UK (€7.4bn), Switzerland (€5.3bn) and Italy (€2.4bn).

The stagnation is worrying "in the light of Europe's increasing disease burden and ageing population, as well as the millions of people whose health cannot be improved without new healthcare approaches," said Janssen in a statement.

R&D spending is around 3 per cent of total healthcare costs in Europe, which are predicted to swell to 12 to 15 per cent of the region's GDP by 2030.

Health policy centre launch
The report marks the launch of the Janssen Health Policy Centre (JHPC), an initiative that aims to establish a forum for debating future healthcare models.

It is envisaged that the group will bring together a wide range of stakeholders, including "public health specialists, healthcare providers, caregivers, policy makers, health economists and patient advocacy groups," according to the company.

Commenting on the new report, Jane Griffiths - who is the chair of Janssen's EMEA business - noted that the downturn in R&D spend is a worrying signal in light of escalating healthcare costs, and given that new technologies generally lead to efficiency gains as their costs tend to decrease over time.

"Today, the innovations of yesterday have become cheap and have become available to all," she said. "But you need the discovery and development of new drugs first."

Article by
Phil Taylor

8th October 2013

From: Research

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