Global Drug Discovery: Europe Is Ahead

[Guest guest]

Health Affairs

Published online August 25, 2009

Global Drug Discovery: Europe Is Ahead

W. Light

Abstract

It is widely believed that the United States has eclipsed Europe in

pharmaceutical research productivity. Some leading analysts claim that

although fewer drugs have been discovered worldwide over the past decade,

most are therapeutically important. Yet a comprehensive data set of all new

chemical entities approved between 1982 and 2003 shows that the United

States never overtook Europe in research productivity, and that Europe in

fact is pulling ahead of U.S. productivity. Other large studies show that

most new drugs add few if any clinical benefits over previously discovered

drugs. I discuss ways in which Congress, employers, and insurers can

increase the value of drugs and revitalize the U.S. pharmaceutical industry.

[Health Affairs 28, no. 5 (2009):w969-w977 (published online 25 August 2009;

10.1377/hlthaff.28.5.w969)]

Light is the Lorry Lokey Visiting Professor at Stanford University,

in Stanford, California, and a professor of social medicine in the

Department of Psychiatry at the University of Medicine and Dentistry of New

Jersey.

~~~~~~~~~~~~~~

PhRMA's Statement blasting Dr. Light's article:

http://www.phrma.org/news_room/press_releases/phrma_statement_regarding_bene

fits_of_u.s._innovation/

Dr. Light's response to PhRMA

August 27, 2009

PhRMA, the American pharmaceutical trade association, issued a strong

rebuttal to an article in the August 25th issue of Health Affairs-web

exclusive that documented the superior research productivity of Europeans to

Americans in developing global drugs since 1982. (See article at

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.5.w969v1 ).

" Global Drug Discovery: Europe in Ahead " apparently touched a raw nerve at

PhRMA because the article took a prominent study that is used to show

American superiority and demonstrated it was due to companies investing much

more money in the United States than Europe, especially in recent years.

By correcting for this bias and comparing innovativeness on a level playing

field, however, Europe came out ahead. Written by Light, the Lokey

visiting professor at Stanford University and a professor at the University

of Medicine and Dentistry of New Jersey, the article otherwise used the same

data and methods as the original study proclaiming U.S. research dominance.

Light also cited evidence over the past 25 years that most new drugs offer

few or no benefits over existing drugs.

PhRMA charges that Light " paints a distorted picture that gives short shrift

to the medical advances made possible by America's pharmaceutical research

and biotechnology companies. " In fact, all the new chemical entities

credited to the United States in the original study claiming American

superiority were included.

The PhRMA statement also charges that the article " ignores the chilling

effect of government price controls on such innovation. " In fact, Light

notes that European research productivity has increased despite countries

negotiating lower prices on many drugs that reflect their added value. He

cites evidence that UK prices on patented drugs are high enough to pay for

all research and related costs and make a reasonable profit. Several other

countries and Canada have comparable prices. But companies can make more

profit faster in the United States, where they can charge about twice as

much; so they usually launch new drugs first in the U.S. Companies also

frequently raise prices on older drugs, which most countries do not allow.

The industry trade association claims that cancer patients are living on

average three years longer due to new treatments, and heart attacks fell by

nearly half from 1999 to 2005. Evidence for such claims needs careful

assessment, especially studies supported by industry. For example, earlier

diagnosis of cancer results in higher 5-year survival rates regardless of

treatment effects, just because the cancers have not advanced as far. Heart

attacks have declined for a number of reasons, including the benefit of

drugs.

As proof of clinical benefit, PhRMA points to the high percent of new drugs

that receive a priority rating from the FDA while being tested. Many of

these drugs, however, do not prove to have much clinical advantage. Only 1

in 7 new drugs offers significant clinical benefits over good drugs

discovered before. The FDA used to rate even fewer as notable until the

industry pressured it to abandon its rating system and replace it with the

looser one used now. The FDA is under constant pressure from the companies

that now pay for its review of new drugs to give them a priority rating.

PhRMA claims that Light used " misguided " ways of attributing new drugs to

Europe and the U.S. Those methods, however, were developed in order to

demonstrate how completely the U.S. has dominated Europe in drug research

productivity by Henry Grabowski, a distinguished economist whose studies the

industry widely cites to claim that research costs are staggering and

profits are modest. By correcting for investment size, Light found that

dollar-for-dollar, European research productivity has increased to surpass

the U.S. in global and first-in-class new drugs. In biotech and orphan drug

innovation, the U.S. still leads.

For all four kinds of drugs, the data from IMS and Grabowski show that U.S.

research productivity has been declining. Other methods for attributing new

drugs might come to different conclusions. More helpful than giving the

impression that nearly all new drugs are developed in the United States when

the data show this is not the case would be to seriously consider reasons

why US research productivity has been declining on a level playing field.

Contact: W. Light dlight@... or dwlight@...

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