Continuing funding shortages, Brexit uncertainty, regulator moves and regulation reforms: there is no shortage of change facing the sector in 2019.
We asked the industry’s trade associations about the biggest challenges to tackle and most exciting opportunities to embrace in the year ahead. What does 2019 have in store for pharma and healthcare?
Managing the health problems associated with an ageing population on an ever-tightening NHS budget will continue to challenge the sector in 2019. But according to the Association of British HealthTech Industries (ABHI), the health service can rise to the occasion by utilising technology.
Jonathan Evans, Communications Manager at the organisation, said: “Treatment for the likes of cancer and stroke is now quicker and more targeted, supporting improved survival rates and life expectancy.
“Yet with this demographic shift comes a rise in chronic conditions, including increased rates of diabetes and obesity, which are now the primary drivers of stress on what is already an over-stretched healthcare system.”
While the cash boost the NHS received in 2018 was “wholly welcome”, it was lower than what many analysts had called for, Jonathan said, adding that many trusts were now operating under “significant strain”.
Identifying, diagnosing and treating people as early as possible to manage or halt disease progression is key.
“Digitally-enabled solutions and data driven products, that make the most of the NHS’ rich information pool, could be the answer we sorely need,” said Jonathan, adding that the adoption of new systems should be solution-based.
“The procurement environment needs to be able to recognise the true value of technology, based on quality, and not simply based on securing the lowest possible price.”
“UK life sciences companies are accustomed to adapting to changes in the ecosystem and the UK has the strong fundamentals of great science and robust financing”
Challenge and opportunity
Pharma faces “myriad issues” in 2019, and the challenges are accumulating at a “considerable pace”.
Leslie Galloway, Chairman of the Ethical Medicines Industry Group (EMIG), said it could be the “most significant year for change that many of us will experience in our lifetime”.
In 2019, the National Institute for Health and Care Excellence (NICE) will start charging for technology appraisals and the “significant costs” of the Falsified Medicines Directive will be felt across industry.
The UK sector will also need to cope with the negative economic impact of losing the European Medicines Agency (EMA) headquarters to mainland Europe after Brexit.
However, by focusing on developing ground-breaking medicines, the pharmaceutical industry can turn these challenges into opportunities, Leslie said, adding that EMIG was committed to facilitating the joint working that would secure success.
“We need to improve our data so our clinical evidence meets the requirements of NICE and we are working to ensure our members can benefit early from all the assistance the organisation has to offer,” he said.
“We also need to develop a better relationship with NHS England, and I believe the opportunity to do that is on the horizon.”
Embrace and adapt
UK biotech had a great 2018, raising more money on both private and public markets than the year before and producing world-leading innovative science.
Building on that success in 2019 relies on access to long-term investment, or patient capital, according to Steve Bates, Chief Executive of the BioIndustry Association (BIA).
He said: “The UK continues to produce fantastic science across a range of scientific areas including genomics, antimicrobial resistance, cell and gene therapy and engineering biology. UK companies are producing therapies that have the capabilities to change and save lives.
“To build on this success, it’s vital that UK biotech companies can access long-term patient capital to give them the funds that they need to grow and scale here in the UK.”
The challenges of 2019 are global, but so are the opportunities.
Steve explained: “There are challenges from the Trump administration on medicines pricing and the ongoing trade issues between the US and China, which are expected to have an impact across a range of industrial sectors.
“But UK life sciences companies are accustomed to adapting to changes in the ecosystem and the UK has the strong fundamentals of great science and robust financing.”
The BIA’s China Special Interest Group has been set up to help UK companies make the most of opportunities to work with counterparts in the Far East, he added.
“Collaborations are already starting to pay off and we are likely to see this trend continue in 2019.”
What about Brexit?
There’s no getting away from the ‘B’ word, and the future of the UK’s place on the European stage continues to concern the whole sector.
The biggest challenge facing the pharmaceutical and healthcare industry is uncertainty, and the actual costs of preparing for a possible ‘hard Brexit’ have already been considerable.
“Uncertainty is one of the most costly factors in terms of investment decisions that have been postponed. That uncertainty will continue until we have a clear picture of our future relationship and that could take a further two years,” said Leslie.
The two most critical issues for the health tech sector, said Jonathan, were the timely supply of goods from the EU into the healthcare system and regulatory alignment.
“We have campaigned for regulatory alignment and for ensuring products used in healthcare are exempt from any new customs tariff or VAT arrangements, afforded pre-shipping clearance and fast-track access across any new areas,” he said.
“But given the ambiguity of Brexit, we are also working on scenarios where the UK does not remain aligned to the regulatory framework and European trading area.”
While news of an initial withdrawal agreement between the EU and UK was largely welcomed by industry, at the time of going to press it was far from final and the prospect of ‘no deal’ was still on the table. There are also concerns that a political declaration on the future relationship between the two parties did not prioritise patient needs.
“All sides need to ensure public health and patient safety are not negatively affected by Brexit. There remains a long way to go for certainty on Brexit for life sciences businesses but the initial agreement on the deal is a key step on that journey,” said Steve.