The global financial crisis could lead to major delays in the discovery and production of many new drugs.

That was the key message that came out of a two-day conference hosted by the UK’s Economic and Social Research Council in London, where it was noted that investment into research for new treatments is now seriously at threat as former investors in drugmakers shy away as a result of the economic meltdown.

David Wield, director of the ESRC’s Edinburgh-based Innogen Centre, stated that "investing in biotech companies is now seen as risk-taking, and will not be for the timid. What will happen to investment in biotech research if finance cannot even be found for relatively everyday expenses which are increasingly becoming more of a struggle”?

He added that drug discovery “depends on long-term finance with high risk of failure – and lots of it”. Financing of biotechnology companies hit the $50 billion in 2007 and the vast majority only made profits for the very first time last year, amounting to $1 billion on revenues of $59 billion, Prof Wield claimed.

In addition to the impact on the basic research performed at biotechnology companies, the development of medicines by pharmaceutical companies has also been hit by the credit crunch, he argued. "Like many other sectors, the pharmaceutical industry has had tough times recently – there is seemingly no way to speed up and improve the drug discovery pipeline, and heavily increased R&D has not increased the number of new drugs”.

Prof Wield noted that as a result, big pharma has been laying off staff and closing down research units, “instead looking to biotechnology start-ups for new ideas".