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Onwards & upwards

Innovation may come in increments, but several steps can lead to new heights

To understand why pharmaceutical innovation is such a critical challenge for Europe, it's important to keep in mind the underlying philosophy of many of today's healthcare systems.

The common approach by governments is seemingly to set a series of budgets for different parts of the healthcare system (hospitals, elderly care, medicines etc). Each of these silos has a separate, fixed budget and when overall healthcare budgets are exceeded the first move of governments is to trim the budget for medicines; this has a lower political cost compared with elderly care, for example.

Over the years, European governments have become very adept at inventing policy tools and mechanisms to limit or cut pharmaceutical spending. However, such measures have had the unintended effect of increasing overall health costs.

Indeed, despite efforts by governments across Europe, several factors continue to drive up these costs, such as the ageing population, uninformed patients and the absence of individual fiscal responsibility; add to this the inefficiencies of a silo system of `sick care'.

Governments, as a final resort - but increasingly so - are simply denying access to treatments and innovative medicines.

Untapped potential
Professor Oliver SchÛffski, of Erlangen-Nuremberg University, in Germany, has extensively documented this in his study, The Diffusion of Medicines in Europe. He demonstrates, among other points, that the majority of European patients with high cholesterol do not receive statins to control their condition. In Germany, only 4 per cent of eligible patients receive SSRIs for depression, and almost 2.5 million people do not receive adequate treatment for their asthma.

In Switzerland, some 100,000 people with Type II diabetes are undiagnosed. In France, fewer than half of patients with multiple sclerosis who are eligible for treatment with beta-interferons actually receive them. In the UK, only 5 per cent of patients with prostate cancer are treated by an oncologist, and 46 per cent of people with breast cancer will die from it, compared with only 25 per cent in the United States.

Not only is the immediate impact on people's health serious, but these policies of rationing healthcare are jeopardising future innovation by denying companies the policy framework that encourages and promotes the research and development that generates new treatments and cures.

Defining innovation
I often hear the refrain that 'we cannot afford it', but my reply is `how can we not afford it?' The cost in human and economic terms of denial of access is measured in hundreds of millions. In this context, the innovative pharma industry is deeply concerned by the tendency of policy makers to apply an increasingly narrow definition of innovation - one that, often, seems to be driven largely by fiscal, not health, considerations.

We can see this narrow definition expressed in a variety of cost-containment measures, such as therapeutic equivalence, formularies, fixed reference pricing and health technology assessment: measures that all have the same effect of delaying, de-railing and discouraging innovation.

One case in point is Germany's current reference price scheme that essentially erases the distinction between newer innovative therapies, still under patent, and older generic alternatives.

In the UK, the primary goal of the National Institute for Health and Clinical Excellence (NICE) is seemingly to cut costs by restricting care, while ignoring overall costs elsewhere in society (ie, tax payers). Perhaps worst of all, however, is that the public does not realise what is happening; decisions that affect their welfare and that of their children are being made without public debate or consensus.

The time is right to open the discussion about what constitutes `innovation', its value to society, and how much society is willing to support it.

Firstly, it is important to recognise that innovation does not consist solely of the `breakthrough' discoveries. Rather - and this is also the case in many other industries - innovation occurs in a series of incremental steps that build steadily on previous achievements.

It is a long, gradual process that spans years, even decades; yet, to many people, the term `incremental innovation' suggests that they are easily produced and then provide only modest advantages to the consumer. The policy implications of this view are deadly to the innovative process.

Frankly, what some people might label as 'incremental,' others would welcome as dramatic or 'breakthrough', particularly patients who are unable to be treated with existing medicines.

Difference for some
Let us consider the non-sedating anti-histamines: Benadryl is an effective antihistamine that has been around for decades. It is relatively safe and provides relief to millions of people who suffer from seasonal allergies, but one of its side effects is drowsiness.

Some might say that a new drug that works just as well but doesn't make you sleepy is only 'incrementally' innovative. But to truck drivers, operators of heavy machinery, doctors - and anyone else who needs to be alert for long periods of time - this new development translates into an ability to be treated at all.

This is not merely an incremental benefit for patients, it is a black and white divide between treating an allergy effectively, and not treating it at all.

Another relevant example we could consider is the treatment of depression: modern medicines for depression, such as, for example, the selective serotonin reuptake inhibitors, provide similar relief for many patients as the older tricyclic drugs, but they are safer and have fewer side effects.

One could argue that a better side effect profile is an `incremental' improvement, but these newer medicines allow doctors to treat many people who, previously, could not be treated with drugs at all.

For these patients, this safer alternative means the difference between receiving pharmacological therapy, or not - and the difference between receiving relief from their depression, or not.

In a further example, the resistance towards multiple daily injections of insulin often means years of insufficient control for Type II diabetics. Even when patients accept insulin, treatment is difficult due to lack of compliance.

That is why Pfizer and its partners have spent hundreds of millions of dollars developing an innovative inhaled insulin delivery system. This breakthrough comes at a cost, of course, but this cost will be more than offset by the considerable reduction in complications of the disease itself. Is that an incremental development, or a revolutionary one? Perhaps the patient should decide.

Maybe the most dramatic example of the value of incremental innovation is HIV/AIDS. Twenty years ago, AIDS killed patients just days after symptoms first appeared. It was a sure death sentence.

While yesterday's drugs were toxic and poorly tolerated, today's safe and effective triple therapies have turned AIDS from a death sentence into a treatable condition. This happened in less than a generation, all because researchers kept striving to make yesterday's medicines better.

Significant steps
Innovation does not always have to involve a single giant leap in order to deliver significant benefits to patients. It often evolves through a series of steady, sequential steps which, when linked together, frequently lead to previously unexplored territory - territory that can deliver better health and lower costs.

Without a public dialogue about the benefits of new medicines, government payers will continue to resort to tools like reference pricing and health technology assessments to define innovation to suit their fiscal purposes, at the peril of the best interests of patients and society.

Strategically, this is an issue of short-term political cycles versus long-term health and economic policy. Can the European governments in good conscience continue to rely on such arbitrary policies and expect innovation to flourish at the same time, or are they ready, willing, and able to change from today's focus on containing costs to a more enlightened vision of health and innovation?

Open to debate
We need an open and inclusive dialogue about the type of healthcare we want in Europe - and how to pay for it.

In place of today's piecemeal system, in which different sections of the healthcare system have their own budgets, we need a more holistic approach to health that includes information, education, early diagnosis, prevention and wellness.

Would it not make more sense to give people more information about how to take charge of their health? Would it not make more sense to give people greater fiscal responsibility for their own care?

With three-quarters of every Euro spent on health being used to manage chronic long-term diseases, we have to ask: would it not make more sense for governments to invest up front in disease management programmes to help patients preserve their health and wellness, instead of simply waiting until people get sick and then picking up the bill?

Further still, would it not make more sense to find a clear, rational way to pay for innovation, backed by fair, transparent, and consistent rules - a system focused on patients' long-term interests?

Create incentives, reward new developments, generate competition, and the cycle will produce great health and wealth for all members of society. Innovation is not a burden to be borne, but a promise for better health. The innovative pharma industry is ready to partner with other members of European civil society to help shape a vision for health.

The author
Ian Read is president, Pfizer global pharmaceuticals - Europe, Canada, Africa and the Middle East

2nd September 2008

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