Economy: Growth

Lord Patel Excerpts

Thursday 31st March 2011 Lords Chamber

[Lord Patel]

My Lords, it is a pleasure to follow my noble friend Lord Rees and I will continue the theme that he started. First, I declare an interest as chancellor of the University of Dundee, where I also worked for nearly 40 years. The university’s College of Life Sciences and Division of Signal Transduction Therapy is a model of the largest collaboration of academia and pharma in the United Kingdom. It is about such collaboration that I wish to speak today.

The Academy of Medical Sciences report, Academia, Industry and the NHS: Collaboration and Innovation, and the NESTA report, All Together Now: Improving Cross-sector Collaboration in the UK Biomedical Industry, highlight the opportunity that the UK has, with its world-leading pharma industry, biomedical science and National Health Service, to produce innovations and economic growth. The pharmaceutical industry is changing its model of R&D investment to that of more extramural funding, which I believe provides opportunities for the United Kingdom.

An ageing population and the increasing use of healthcare in the BRIC countries means that the industry has huge growth potential. Countries such as the USA, Singapore and France have recognised this by increasing their investment in research capabilities. We have strong research universities in life sciences, as evidenced by the high citation impact, which beat even the United States of America. But we underexploit the resources that we have—the NHS, universities, and large and small pharma.

While strong institutions, enabling regulations, funding and people with research skills are important, what is lacking across the country is collaborative mechanisms, and the fora, incentives and metrics that promote and encourage interactions between the players. Collaboration allows a better use of resources, avoids duplication and improves access to specialist facilities and expertise, which importantly improves the capacity for innovation. Big pharma is increasingly looking for external partners for drug development. Industry currently funds around 10 per cent of biomedical research in UK universities. If universities were to increase this to 15 per cent, it would mean an extra £100 million, which still would be only 8.5 per cent of extramural R&D funding of pharma companies.

There is a risk that the UK will remain static while other countries grow. One indicator of the extent of such collaboration could be an analysis of the levels of clinical trials activity in each hospital trust. Currently, the number of patients enrolled in clinical trials is low and falling. Collaboration would produce company growth in the private sector and increase income in the public sector. As pharma grows, R&D spend will grow. By 2015, there could be an additional £3 billion in external R&D funding. We need the right infrastructure, an electronic patient record system to support research and reform of the VAT system to encourage collaboration, and to develop more specialist support services.

The UK should accelerate the development of electronic patient records to support medical research and aim to become the world leader. Scotland has made a success of this and provides a valuable research resource. Industry can help by providing more industry placements and secondments. The intellectual property model of universities, NHS and pharma needs to change from getting income to developing research further. There needs to be more sharing of research facilities to reduce costs. Similar arguments could also be made to pricing policies for research that involves risk sharing.

I hope the Minister agrees that in our world-leading pharma, leading research universities and the NHS, we have fantastic opportunities to bring about innovation and treatment of disease. The Government should examine ways to see how best to bring this about.