The tools and technology which the pharmaceutical industry has now to fight disease have never before been so precise, good and strong, and it would be an “absolute disaster” if the “accountants’ view” that innovation has now slowed down were to prevail, according to Bernard Poussot, president and chief operating officer at Wyeth.

Innovation is hard, high-risk and fragile, and it must be protected and encouraged, said Mr Poussot, speaking at The Economist’s annual pharmaceuticals conference in London. We need to recapture the sense of urgency and progress, he said, and called on the industry to “continue to lead and fight tooth and nail for innovation.”

Wyeth is now concentrating on delivering two new products a year, which means getting 15 into development annually, he told the meeting. The company is applying the concept of innovation to every aspect of its work, and has revamped its R&D into a “learn and confirm” process, which he said has received a very positive response from international regulators.

The public wants innovation, but only has a very vague notion of where it comes from, he said; people need to realise that the drugs which they buy today are funding the treatments they want for tomorrow. The mission of governments and payers is to act for their constituents, but they need to let innovation flourish, he said; reimbursement schemes should recognise innovation, put money into training scientists and develop headroom for innovation. In the same way as companies continue to redevelop their business model, governments should rework their own, increasing people’s responsibility for their own health and addressing high-cost issues such as smoking, alcohol and sexually transmitted diseases.

Mr Poussot also said it was “mind-boggling” that the growth of the pharmaceutical industry is being capped in many countries, while for other sectors, such as the digital phone industry, it is not.

The industry’s future is about partnership, he said, a view which was shared by Roch Doliveux, chief executive at UCB. A new innovation paradigm is emerging, and partnership is becoming a key competency for the industry, said Dr Doliveux. He urged companies to forget hierarchical structures in favour of working in networks, or what he called ‘the beehive effect.”

It all starts with patients

UCB has also completely changed its business model, and is now partnering all the way through the value chain. He stressed the need to focus on certain disease areas or parts of the value chain, and to remember that it all starts with patients.

While some companies are placing their focus on specialist care products, Dr Doliveux said that, as primary care physicians will become gatekeepers more and more, and to ensure that patients follow up on their treatment, companies will need a primary care presence in the next generation of treatments in areas such as Alzheimer’s disease, pain management, etc. Primary care is an “and,” not an “or,” for big pharma, the meeting heard.

Speakers also disagreed with suggestions that, despite the high levels of innovation coming out of small groups - whether these are individual companies or autonomous groups set up within larger organizations – the days of big pharma’s international discovery organizations are numbered. They will always have a place, said Louise Makin, chief executive of BTG, pointing to their achievements in breakthrough research, consolidation of scientific expertise and ability to take the “big bets” due to their scale, financial strengths and power.

Innovative products get to the market far more quickly in the USA than in Europe and with better pricing, but Europe pays more for older products, said Charles Bouchard, executive director for European government affairs at Merck Sharp & Dohme (Europe). “In the USA, the difference between being on- and off-patent is the difference between night and day,” he told the meeting.

There remains an “ocean-wide” difference between the US and European markets but, as US seniors without sufficient health coverage struggle to pay for their prescription drugs, legislators are beginning to look at European models, he said.

UK “must not go the reference pricing route”

All European markets are facing severe budget crunches, and at a time when pharmaceutical innovation could hardly be more needed, he said. Comparing the various methods of pricing mechanisms used in Europe, Mr Bouchard said that the Pharmaceutical Price Regulation Scheme (PPRS) has worked well in the UK. In comparison, France has “every form of price control,” and the situation in Germany has deteriorated due to the introduction of reference pricing there. “The UK must not go this route,” he stressed, nor should it adopt any other of the “bad practices” now in place around Europe. “Consider innovation - do not kill the golden goose,” he stressed.

Sir Alasdair Breckenridge, chairman of the UK Medicines and Healthcare products Regulatory Agency, wondered if, in light of the Office of Fair Trading’s (OFT) report on the PPRS, the industry will have to embark on a “charm offensive” in order to make the public better understand the nature of innovation. Mr Poussot agreed that the industry definitely needs to talk and explain more, while Richard Barker, director general of the Association of the British Pharmaceutical Industry, said that what is needed is not a charm offensive but genuine education.

“We are a faceless industry,” he added. Dr Doliveux, who said he was “very concerned” at the OFT study, was highly critical of US-style direct-to-consumer advertising but pointed to the need to talk with patients rather than to them, and to remind them that “we are here for them.” Lynne Taylor