A study of Ireland, Canada, Singapore, the United Kingdom and Massachusetts in the USA.
There is considerable global potential for biopharmaceuticals with a predicted annual growth of eight to ten percent for the coming years, which is more than double that expected for traditional pharmaceuticals. In 2014, seven of the eight best-selling pharmaceuticals in the world were biopharmaceuticals. Considering the fact that the number of people employed in Sweden’s pharmaceutical industry has dropped sharply during the last decade, biopharmaceuticals offer interesting growth opportunities.
Biopharmaceuticals are drugs whose active substance is produced in, or extracted from, biological materials (living cells or tissue) and that, due to their complexity, cannot be characterized only by testing the end-product. Moreover, biopharmaceuticals have a molecular structure which is sensitive to changes in the manufacturing-method. The characterization of a biopharmaceutical requires a combination of tests of the drug substance and the end-product as well as knowledge about the manufacturing process.¹
Sweden’s research portfolio of pharmaceuticals is evenly distributed between traditional and biological pharmaceuticals and the number of potential biopharmaceuticals has been at roughly the same level since 2008.² There is a relatively large number of small enterprises in Sweden that develop biopharmaceuticals. Moreover, today half of AstraZeneca’s research portfolio consists of biopharmaceuticals. At the same time, there are expectations that the number of Swedish biopharmaceuticals will rise since large investments have been made in molecular bioscience research.
Sweden has also attracted companies like Pfizer and AstraZeneca to invest in production plants for biopharmaceuticals, largely thanks to good production competence. Sweden should therefore be relatively well positioned to partake of the growth and welfare it is believed biopharmaceuticals can provide. At the same time, the realisation of this potential is affected by other countries’ development in this field. This report studies certain investments and trends intended to promote the discovery, development and manufacturing of biopharmaceuticals in Ireland, Canada, Singapore, the United Kingdom and the state of Massachusetts in the USA.
The survey shows that extensive investments in biopharmaceuticals are being made in all the countries studied. The United Kingdom and Massachusetts, world-leading in the field of molecular biosciences, have developed special Life Science strategies. Canada has an explicit focus on research and the commercialisation of biopharmaceuticals. Genome Canada, Genomics England and US Precision Medicine are initiatives which, when combined with investments in competence and infrastructure, put these countries in a good position to develop innovative biopharmaceuticals. In addition, both Ireland and Singapore have moved ahead with regard to attracting investments in research and production facilities by using tax incentives and skills development. In recent years, all the countries have made proactive use of different forms of tax incentives for research, development and production which has benefitted the development of biopharmaceuticals.
The development of complex Life Science products like biopharmaceuticals requires extensive integration of knowledge. Research, development, manufacturing, commercialisation and uptake are moving closer together, something that frequently forces players to reconsider how they cooperate with others. It is interesting how this trend tends to influence the way the countries’ political leaders, departments and government agencies organise themselves. One of Canada’s biggest investments in biopharmaceuticals is controlled jointly by Industry Canada and Health Canada while the United Kingdom has created an Office of Life Science that is shared between the Department for Business, Innovation & Skills and the Department of Health. Massachusetts has the quasi-public organisation Massachusetts Life Science Center.
The United Kingdom, Massachusetts and Canada all have a clear focus on speeding up the process of turning research into innovative and growth-driving biopharmaceuticals. One of the most important instruments for achieving this is government calls for applications that focus on verifying concepts and taking new biopharmaceuticals to market. The Biomedical Catalyst in the United Kingdom is a success story that is praised by British industry. Another example is the Genomic Applications Partnerships Program that was developed within the framework of Genome Canada and which was launched in 2014. Canada has also started up a number of national networks of excellence that focus on converting research into innovative biopharmaceuticals and methods of diagnostics.
A stronger focus on turning research into innovation also means more importance is attached to patents. Patenting tends to be of greater significance for biopharmaceuticals compared with traditional pharmaceuticals.³ In both Massachusetts and Canada, patents have had a big impact on the design and evaluation of public investments linked to biopharmaceuticals. In Massachusetts, for example, early investments in Technology Transfer Offices gave the state a head start when it came to turning patents into new pharmaceuticals. Within the framework of the above-mentioned Canadian networks of excellence, special instruments have been designed to help researchers handle patent applications. Ireland and the United Kingdom have introduced “patent boxes” to increase businesses’ incentive to invest in research and development. Moreover, several countries are debating the scope of patent and data protection for biopharmaceuticals and how it affects investments in research and innovation.
The manufacturing of biopharmaceuticals is complicated which means production is of great strategic significance. For example, in Massachusetts and Singapore, for several years there have been round-table discussions where representatives from the state, the academic community and the business world meet regularly to discuss the prerequisites of bioproduction. The countries use various methods to try to stimulate pharmaceutical companies to set up production themselves, to use existing production infrastructure and to promote contract manufacturers. Furthermore, the countries endeavour to create the prerequisites for different forms of production, both small volumes for clinical trials and full-scale production.
Several of the countries are investing in research and skills development in the area of continual production. For example, new tools are being developed to analyse processes, decision support, single-use systems and new production techniques. To bring about the desired effects, the countries invest in infrastructure, skills development programmes, internship programmes, national research networks and new programmes for research funding. Several investments in the United Kingdom and Canada are aimed at small research-based companies. One reason for this is that small enterprises that have set up production in the country are less at risk of being moved if they get bought up.
In several countries, different forms of public-private collaboration projects have been used successfully to develop new biopharmaceuticals. Both Massachusetts and Canada have succeeded in establishing pre-commercial consortiums where the academic community collaborates with a number of pharmaceutical companies to identify pharmaceutical targets and develop new forms of treatment. Some of the success factors have been finding a good balance between critical mass and a manageable number of participants, early discussions to find common project objectives, agreements about how to handle intellectual property, and professional project management.
The United Kingdom and the USA (led by Massachusetts) are seen as being world-leading nations within genomics, proteomics and bioinformatics. This research is the basis of the development of biopharmaceuticals. One interesting observation is that Genome Canada assesses that Canada, despite its early investments, will not be able to take on a world-leading position and they claim that over the coming years, Canada should strive to maintain its collaboration with leading countries and at the same time develop its cooperation with growth nations. To speed up the research, a number of players in the countries studied are involved in international research consortiums, one of whose purposes is to share different forms of data. By linking the research and innovation system with this type of consortium, Canada has succeeded in attracting both research investments and clinical trials.
During the last decade, Sweden has made big investments in molecular biosciences in the hope they will result in innovative biopharmaceuticals. Despite these investments, Sweden risks falling behind because several other countries are making large, innovative investments with a clear focus on scientific excellence, innovation and growth. To cope with this competition, Sweden needs to do what several other leading countries do, namely, develop a target-oriented and integrated policy. In this regard, we can learn from Canada’s strategic focus on biopharmaceuticals and how they have organised themselves. Sweden also needs competitive taxes since leading countries are striving actively to develop tax incentives for private investments in research, development and production. Sweden has a tradition of production which constitutes a competitive advantage within the field of biopharmaceuticals. At the same time, other countries are investing heavily in infrastructure, research and skills development within bioproduction. Here, Sweden needs to ensure that we can retain our position at the front edge. In addition, Sweden needs to link up its research and innovation system with national and international pre-commercial research consortiums in the fields of genomics, proteomics and bioinformatics. Because patents are of great significance for the commercialisation of biopharmaceuticals, it is important to develop the way universities and research financiers work with patenting. Some potential areas of development are presented on the next page.
Potential areas of development
To improve Sweden’s chances of partaking of the growth and welfare it is believed biopharmaceuticals can provide, we can:
² The Swedish Drug Development Pipeline 2014, Sweden Bio
³ Roland, G. E., Xu, J. J., & Wagner, J. A. (2015). First‐to‐Patent Does not Predict First‐or Best‐in‐Class: Analysis of Approved Small Molecule vs. Biologic Drugs. Clinical Pharmacology & Therapeutics, 97(1), 19-21
Serial number: Direct response 2015:23
Reference number: 2015/197