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The Economic Environment for Clinical Research & Development in the UK

 

The Economic Environment for Clinical Research & Development in the UK

 

Briefing Paper

Key findings of report by Europe Economics, funded by Novartis

  • The cost of undertaking clinical trials in the UK is significantly higher compared to other European countries.
  • Participation in clinical trials has a positive effect on patients, clinicians and access to up to date treatments.
  • The scope for completing clinical trials within the NHS and in the UK in general is under exploited.
  • Industry, NHS, academia, regulators and Government need to work together to create a more attractive environment for clinical trials in the UK.

Novartis’ position on the economic environment for clinical research & development in the UK

The context

  • An estimated two-thirds of all medicines research in the UK is carried out by the pharmaceutical industry, which invests £12.1 million a day in R&D.
  • The industry directly employs 67,000 people of whom 25,000 work in R&D.
  • The UK lends itself to be a natural home for clinical trials with an abundance of life science companies, academic institutions and medical research charities all willing to work with the diverse population that the NHS provides to advance medical innovation.
  • However, the number of clinical trial applications received by the UK Medicines and Healthcare products Regulatory Agency (MHRA) has been declining from approximately 1,150 applications in 2005 to 947 applications in 2011. This represents a fall of around 18% in trials in the UK between 2004 and 2011.
  • It takes on average 12 years and £1.15 billion to conduct the research necessary to develop a new drug and take it to market.
  • Costs have increased significantly and the delays for launching a clinical trial have risen by 90%.
  • Double the number of staff are needed in a pharmaceutical company for the administrative work for submitting a request for authorisation of a clinical trial compared to prior to the introduction of the Clinical Trials Directive.

Benefits of conducting clinical trials in the UK

  • Participation in clinical trials has a positive effect on patient outcomes, with patients gaining access to new research treatments before they become widely available.
  • Clinical trials conducted in-country improve the volume of drugs available which are relevant to local patients and ensure patients are treated with the most up to date treatments.
  • One of the most significant benefits from drugs being developed in-country is the faster access to those medicines for local patients post approval.
  • Clinicians who participate in trials become more aware of the relevant indications, effects and drawbacks of drugs, and are therefore generally better placed to decide when to prescribe them or recommend their use.

Challenges of conducting clinical trials in the UK

Costs

The report found that, out of the five countries compared, the UK had the highest costs. Trials in the UK are, on average, 70% more expensive than trials conducted in Poland and 30% more expensive than trials conducted in Germany. This is largely driven by additional and unnecessary costs associated with set up, overhead and pharmacy expenses, all of which are already provided for in the national costing template, but protracted negotiation incurred by non-compliance with this template slows down study start up in the UK and thus limits the ability to recruit to target.

Structure of clinical trials system

The UK has a decentralised system which leads to issues with ‘recruit to target’ rates with the UK performing particularly poorly. The research conducted for this report found that the UK had the lowest percentage of trials with a recruit to target rate of over 90%, with just 55% of trials reaching this figure, compared to 100% in Spain, 77% in Poland, 69% in Italy and 59% in Germany. The most resource intensive phase of any clinical trial is the start up and if only one or two patients are enrolled, this is very inefficient. Efficiency increases significantly for a site with each patient enrolled and this is mirrored in sponsor resources required to manage the study.

Payment structure

Many in the NHS appear to systematically treat trials as if they were a departure from the NHS’ core functions – a departure that needs to be compensated for with high charges. The payment structure in the UK may be part of the problem and may affect the willingness of investigators to take part in trials. In the study, only the UK system demands that 100% of money from trials goes directly to central Trust funds with only a small percentage distributed to the investigator’s unit via the income distribution model. In Spain, the proportion of money being paid directly to the investigator’s unit is between 60-80% and in Poland it is 50-80%.

Government policies

Whilst significant strides have been made by Government in introducing supportive measures for the Life Science industry, which are to be welcomed, some policies have unintended consequences on a company’s ability to invest in R&D in the UK. For example, the Patent Box can only be utilised by companies who register their IP in the UK.

Improving the environment for clinical trials in the UK – Novartis’ proposed solutions

Issue: Costs

Solution: The UK is currently in a unique position whereby we are the only country in Europe with a single model Clinical Trials agreement and associated costing template – it is vital that we make the most of this and Trusts resist the temptation to try to charge additional fees on top of the costing template – not only does this drive up the UK costs but it also causes significant delays to start up and has a detrimental impact on recruit to target potential.

Issue: Structure of clinical trials system

Solution: The Government should explore the scope for centralising drug trials under a regional hub & spoke model, which would create efficiencies in specialisation and patient referral. It is estimated that focused sites achieve 41% higher enrolment and are almost twice as productive as unfocused sites. This could be because local groups may be better positioned to recruit patients in each region and may be better-able to identify intra-regional diseases prevalence, demographics and trends. In addition there are quality benefits as each hub site would become an expert in delivery of any particular study. Equally, reducing the number of sites with whom companies have to engage in individual negotiations may also reduce the cost of trials in the UK.

Issue: Payment structure

Solution: A cultural shift in attitudes towards trialling is required, as well as a review of funding flows, to ensure that investigators are adequately incentivised for the R&D work undertaken.

Issue: Government policies

Solution: Consideration should be given to ensuring that the Patent Box can be utilised by companies exploiting IP in the UK, not just those companies who register their IP in the UK. Similarly, a review of R&D tax credits is needed to ensure that companies who invest heavily in R&D do not disproportionately lose out, with a corresponding drop in corporation tax.

About Novartis in the UK

  • Novartis UK is the UK affiliate of Swiss-based Novartis AG – one of the largest and most widely respected healthcare companies in the world.
  • Novartis UK employs over 3,500 people across eight sites. The UK is a major centre for research, development, sales, marketing and manufacturing.
  • The Respiratory Research Centre at Horsham is the Novartis worldwide headquarters for respiratory research, employing over 500 scientists in a £42 million purpose-built centre.
  • The Novartis Vaccines facility in Liverpool is the UK’s only large-scale producer of influenza vaccines and the company is still investing heavily in new manufacturing facilities at the site.
  • Novartis has invested over £450 million in the Grimsby manufacturing site over the last 10 years.

About the ‘Economic Environment for Clinical Research & Development in the UK’ report

Novartis engaged Europe Economics to consider the benefits of clinical trials for patients and clinicians, to highlight the economic efficiency of conducting clinical trials within the NHS and to provide a qualitative economic review of best practice in facilitating clinical trials with reference both to NHS Trusts and to experience in Germany, Italy, Spain and Poland.

 

 
 

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