New evidence of a steep decline in the pharmaceutical industry’s confidence in the UK as a place to do business is “very worrying,” the Confederation of British Industry has warned the government.
Three-quarter of UK-based drugmakers now have little confidence in the current domestic market environment and a massive 83% believe that it will get worse over the next 12 months, according to a survey of 101 companies conducted this month by the CBI and the Association of the British Pharmaceutical Industry.
Around a third of companies said they plan to lay off staff and cut back on R&D spending in the coming year, while 42% expect to reduce the number of clinical trials they carry out in Britain and 42% will slash their UK manufacturing levels, the survey also revealed.
About 8,000 jobs have already been lost from the UK industry within the last three years, out of its total workforce of around 70,000, ABPI director-general Richard Barker told a press meeting, while John Cridland, deputy director of the CBI, said the survey’s findings are all the more alarming given the currently buoyant state of the remainder of the UK’s manufacturing industries; their orders are currently running at above average, while those for the pharmaceutical sector are below normal.
Lack of confidence ‘should be of deep concern’
As one of the UK’s flagship industries and “a bellwether for the UK’s ability to thrive as a value-added economy in a globalised world,” pharma’s “lack of confidence in the UK business environment should be of deep concern to the government,” said Mr Cridland, adding: “The sector needs to be carefully nurtured and its contribution to the UK economy must not be jeopardised.”
The UK is still the world’s leading source of new medicines after the USA and it continues to attract greater levels R&D investment than other European Union markets, but its position is declining and fragile, warned ABPI president Nigel Brooksby. It is facing strong competition from the emerging economies such as Brazil, Russia, India and China, which are becoming attractive places to conduct R&D, and with the breaking by the government of the Pharmaceutical Price Regulation Scheme this month, the UK now lacks the stable, predictable environment for investment which the PPRS has provided for global companies over the last 50 years.
A new drug pricing agreement is to be in place by September 1, but Mr Brooksby called for “a negotiated settlement as quickly as possible, not at the eleventh hour,” in order to remove the “black cloud of uncertainty” which is now hanging over the industry. Dr Barker said the PPRS negotiations now underway with the government are “much broader than they’ve ever been,” and Mr Cridland stressed that that the new agreement must be a “joined-up policy “ which is “conscious of the total contribution which pharma brings to the UK.”
