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Interview: Richard Bergström, EFPIA

The new director general of the European Federation of Pharmaceutical Industries and Associations (EFPIA) tells Liz Wells about the challenges involved in keeping the regional market sustainable 

Richard Cushion

The new director general of the European Federation of Pharmaceutical Industries and Associations (EFPIA) tells Liz Wells about the challenges involved in keeping the regional market sustainable. 

The biggest challenge that the industry is facing currently is the financial crisis. We knew that, when governments had to pay back money or cut their deficits, healthcare would not be spared. We are realistic, we are all citizens and tax payers, so we knew we would have to contribute to this, but the cuts need to be short-term measures and they need not to harm innovation in the long run. 

I could probably write a book about the long-term challenges that the industry is facing, but it is mainly about the general dynamic of drug development. We have to focus on the fundamentals, aligning expectations, because there is a mismatch. On the one hand, there is huge potential scientifically with drug discovery going up. There are a lot more targets and everyone is excited about the science. At the same time, we have a market environment, which is the demand side of things. We should develop medicines people want, but we need to know that they will be used. 

I think that when we look at European challenges, we have one regulatory system that works fairly well, but when it comes to the issues that I have described, it is a patchwork and it is actually deteriorating. Innovative medicines are delegated far out to healthcare systems, to local and regional authorities.

The further away you come from the national and European discussions, the more this will only be about budgets and it will only be about the price of a product; people will see the price tag, not the value. Investment decisions are very narrow-minded and you don't think about society at large. However, we cannot centralise these decisions. These are national responsibilities. The UK government will not accept Brussels dictating healthcare, for example, but there is certainly room for co-ordination and for sharing best practice and that is what we need to do. There must be a co-ordination of objectives, somewhat similar to what happens in the US. Their system is somewhat disparate as well, but they have a country-level discussion. We don't have that here so we need to somehow tie the European agenda together with the national agendas. 

Sustainable growth
Europe has very generous welfare systems; we have citizens that expect to get everything and we have an ageing population. There is a lot in the pipeline, but we need to think carefully about how we make healthcare sustainable. It is about using medicines correctly and finding a balance between new medicines and generic medicines. It is also about organising healthcare in a better way, particularly for chronic diseases. We need to have this discussion at a European level and I think that industry can contribute because we know so much about diseases and our medicines. 

We need to have this agenda because our industry is lagging behind. In the past 20 years, more and more R&D investments have gone to the US. More recently we have seen research moving to Asia. In Europe, beginning clinical trials or launching a product is very complex and takes a very long time; you have to get pricing approval from 27 Member States plus all the regions. It is not easy for a small company to enter the market. It is difficult from a skills and a money perspective and really it is only big pharma that can do it. We need to have both big and small companies living side-by-side.

These two things are the greatest hurdles: the regulatory environment, combined with a budget focus, so there is no interest in using new medicines. It creates an environment which makes people say: 'We'll go somewhere else'. We need to restore Europe's competitiveness by giving incentives for research, having less regulation, simplifying things. We need to have a market that is interested in new products because otherwise the research will leave and go to more dynamic environments. I do not think that the industry has lost interest in Europe yet. I am an optimist; I do not think that it will leave Europe, because this is where it all started. We are very strong academically and we have strong healthcare systems, of which we should be proud. 

Growth in the industry will be seen in Central Europe, as it catches up with investment in healthcare. We need to remember that it is not that the region uses more medicines; it is coming from a level where they spend much less on health. You will see growth of maybe up to 10 per cent each year for a couple of years. The big growth is in the emerging markets; this includes the BRIC countries, but also countries like Mexico, Korea, Thailand and Indonesia. If we get it right, with the development pipeline and with healthcare systems that want to use and deliver new medicines, then the European market will pick up again. Of course we have learnt that it has to be sustainable; we know that we can't break the bank. 

We have had some successes in Europe. The European Medicines Agency (EMA) is one such success. Some people thought that it would never work because there was no way that all of those countries would agree on one proposal. Also there is the Advanced Therapies Regulation that works to stimulate advanced therapies, such as stem cells, regenerative therapies and cell therapy.

These are good examples of where legislation helps promote innovation, but unfortunately it's the access to markets, pricing and reimbursement that are deteriorating. We need to tackle these problems at a European level without taking away the national responsibility. We think there is scope for greater co-operation. For instance for some parts of Healthcare Technology Assessment (HTA), parts of what the UK's National Institute for Health and Clinical Excellence (NICE) does, the clinical assessment could be done at European level and we are willing to discuss that.

Industry partnerships
I see partnership working at two levels. One is the macro level, where industry organisations can help build healthcare systems so that they give value for money. For example, consider the UK consultation on value-based pricing. In Sweden, we have had value-based pricing for about eight years and everyone loves it. That is an opportunity for governments to learn from industry because we operate in all these different countries and we know our medicines. Other partnerships are about securing global access to the most underdeveloped countries and those with the least money. You organise different types of relationships so medicines get there and are affordable. I have seen some good examples of this recently. 

The other aspect of partnerships is at the micro level and involves sitting down with governments and discussing how particular medicines are introduced and how they are followed and monitored. In the UK there are patient access schemes, while in Germany there are negotiations between the company and the sickness funds, which implies some agreement on how things should be introduced. There will still be a role for sales reps, but in a broader framework within healthcare.

Patient involvement
We need to be responsive to real needs and by this I do not mean just some expert committee sitting somewhere, the WHO [World Health Organisation] saying we need these three medicines; we need to involve patients to work out what the real needs are. I think there will be a much stronger patient movement that will exercise some pressure on industry and I think we need that. We would listen and also governments would listen and make sure that something is developed. There is a long way to go, though.

I think I am well placed to help achieve these things. I am an industry insider. I know the industry very well and I know my members well. I understand drug development, which I think is important because at the moment we have to go back to basics, it's about drug development. Can we do it faster and cheaper?

I also bring my way of working to the role from Sweden, which is about listening to the outside world. We have to correct the things that need to be corrected and we must also be constructive. We should ask for things and not be shy; we are companies that need to make money. However, if there are problems in our behaviour then we should fix them and that attitude of listening and acting on what you hear is important.

I have worked very closely with the Swedish government to shape value-based-pricing. We had a model that is different from that of NICE; it is more socially based, with less number crunching, using health economics as a cornerstone. Also we [Sweden] addressed inappropriate behaviour, we clamped down and regulated the industry strictly, before most other countries. That created a very good platform for partnerships with the government. We are at the table in Sweden. I am not always happy with the speed of things, but we are part of the discussion. I believe we have a pretty good reputation. If you want to be a partner you have to behave like one. 

Fortunately for me there was a reorganisation of EFPIA in 2010. A set of priorities has been laid out and there is a new structure for our committee work. There is strong support from our 20-25 member CEOs: when we have our board meetings there is a new generation of leaders that have taken over and they have clear ambitions. It is my job to deliver on those aspirations. We would like to position the industry as a true partner in addressing these challenges, at the European level and also in other countries. 

It is important that readers realise that we need to do two things in the next few years: to show that we can change behaviour when we should, while not being shy about stating what we need: predictability, reward for innovation and to make money. We can do both and I hope everyone in the industry will support this.

24th June 2011

From: Sales, Regulatory



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