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Crunch time for pharma
OPINION
Crunch time for pharma It’s time to “liberate” big pharma’s cash mountain. Give their money to the universities, which can make better use of it, argues John Martin MONEY has thrown society out of kilter. Banks that once appeared to have mountains of cash have collapsed. As a consequence of the global recession, governments now recognise that banking is too important to be left to the bankers. States have taken action, from wresting control of financial institutions to introducing new regulations. I believe the financial meltdown has implications for pharmaceutical research. The running of large pharmaceutical companies carries a social responsibility that is as heavy as running any bank. Recently, however, this unwritten contract between society and drug companies has not been fulfilled. Is our health now too important to be left to big pharma? To illustrate my concerns, let’s look at the treatment of heart disease. Many important cardiovascular drugs have been invented: statins, ACE inhibitors, beta blockers, fibrinolytics. But in the last 10 years, few of significance have emerged, even though the pharmaceutical industry has spent unprecedented amounts of money on research and development: in each year of that decade, Pfizer spent about $6 billion, Eli Lilly $3bn, and GlaxoSmithKline $2.5bn. This splurge is reminiscent of how banks misused their funds before their collapse, but the industry has been insulated from the recent economic changes and has accumulated vast cash piles from the sales of medicines (in the UK, mostly through sales to the National Health Service). On average, each 24 | NewScientist | 10 October 2009
top-20 pharmaceutical company economic forces with much has access to about $7.5bn in cash. certainty. The fall of big pharma Could the cash piles of big could be imminent. pharma be mobilised in a more There is another way to efficient way for the public good? fund the development of new Two years ago such a suggestion treatments. Many innovative would have been scorned. Now, ideas that have changed society however, it should be considered. have arisen from the combination As was the case with the banking of curiosity and academic sector, I believe that there is a real freedom found in universities. risk that the big pharma industry This is where small amounts of might collapse. funding can produce big results. Increasing spending on R&D In recent years, university cannot be continued indefinitely research has been exploited by with such meagre progress. If a industry to produce new drugs, collapse of the pharmaceutical industry does occur it might not “I believe that there is a real risk that the be for decades, but one of the big pharma industry biggest lessons of the banking collapse is that no one can predict might collapse”
such as blood clot-busting “tissue plasminogen activator”, courtesy of the Catholic University of Leuven (KUL) in Belgium. Now, while big pharma has so much money it doesn’t know what to do with it, universities are being starved of resources and research funding has decreased in real terms. At the same time, university research strategy is underorganised and there is ignorance of how to exploit intellectual property and utilise patents. Nevertheless, the potential of universities is enormous. Sadly, because of intense competition for limited funds, academic scientists are now driven to perform predictable low-risk science in small packets that will give quick results in time for the next grant application. The end result is that we have a plethora of small groups with strong leaders that act independently, fragmenting effort. At the same time, little translational research is being performed, even though politicians pay endless lip service to the idea. So on one hand we have an unproductive big pharma which is cash rich, and on the other a cash-poor university system that has produced fistfuls of Nobel prizewinners. The way forward is obvious: inject the money into university research. Experience tells us this can have major benefits. One of the most successful initiatives in the last decade has been the spin-out of small biotech firms. My own, Ark Therapeutics, emerged from University College London and
Comment on these stories at www.NewScientist.com/opinion
John Martin is professor of cardiovascular medicine at University College London and founder of Ark Therapeutics
One-minute with...
Don Eigler Two decades on from his landmark achievement of writing “IBM” using 35 xenon atoms, how is nanotech progressing? What made you spell out “IBM” in xenon atoms? Was it just a publicity stunt? Our first experiments actually had nothing to do with atom manipulation, but what they taught us was that we could exert forces on atoms. Then we decided to see if we could reliably reposition them on a surface. Once we had managed to get the atom-moving process under control, the idea just came to me. The biggest challenge was remembering how to spell IBM. What did this experiment mean for science? It has proved to be an extremely powerful scientific tool, changing the way we think about building small structures and how we control things on a small scale. Prior to this it was only through chemistry that we were able to build atomically precise structures. Did it have an impact on the rest of the world? Twenty years ago hardly anybody used the word “nano”. It was not part of our everyday jargon. Now I have an iPod Nano in my backpack. Has nanotechnology trickled down into everyday life yet? To some extent. It’s showing up in coatings, cosmetics and sunscreens, and it’s starting to show up in electronic devices. The length scales at which we manufacture computing devices are at the lower end of the nanometre scale. My laptop and cellphone are chock full of nanometrescale technologies. But I think it’s going to evolve to produce new technologies which will have a much broader impact. What sort of evolution do you have in mind? I like to differentiate between evolutionary technology and revolutionary technology. My cellphone and laptop contain evolutionary nanotechnology because they can be traced back to larger structures. Revolutionary is still very much in the future, but I’m thinking of things like new forms of drug delivery or new kinds of molecular structures. The bulk of the influence
PROFILE Don Eigler is a physicist at IBM’s Almaden Research Center in San Jose, California. He pioneered the use of scanning tunnelling microscopes to manipulate single atoms
on the person in the street is still to come, but there’s a 16-year-old kid out there now who’s going to come up with something really wonderful. What is your take on the health fears surrounding nanotechnology? I have no concerns, but I do have great hopes. I think the beneficial effect of nanometre structures on health is likely to be revolutionary. But I’m also very much aware of the potential toxicological impacts of nanoparticles. My view on this, which is shared by most of my colleagues, is that with testing and an appropriate degree of regulation we’ll be able to reap the benefits with very little in the way of a downside. That would be my hope – getting it right is our responsibility. What are you currently working on? We’re trying to find new ways to do computation in very small structures, something that might be the follow on to the silicon transistor. Our focus is to see if we can do computation using only the spin degree of freedom of electrons. Interview by Duncan Graham-Rowe IBM
is now a public company with three phase-III clinical trials under way. Similarly, Biogen sprang from the Massachusetts Institute of Technology and Genentech from the University of California, San Francisco. Now is the time for government action. Big pharma is international, so measures would ideally have to be taken by the European Commission at the pan-European level, by the federal government in the US or as a joint initiative. Nationalisation, or internationalisation, of the $150bn cash mountain of the top 20 companies is probably unthinkable. However, the tax system could at least encourage pharma to invest more wisely. In the UK, for example, immediate funding could be generated for university research if the Chancellor of the Exchequer were to extend R&D relief for corporation tax to big pharma. But more money is not enough. The universities themselves would have to become more businesslike about how to achieve commercial goals – such as creating a new drug – while preserving their academic freedom. Control must not be allowed to follow the cash, though, or the creative ethos of the university may be stifled. The involvement of small spinoff biotech companies could be a condition of receiving such funding, generating jobs. One hundred new companies could be created from British universities alone over 10 years if big pharma money were blended with a proactive way of recognising patentable inventions and managing university science. The credit crunch has been a vivid reminder of the responsibility that comes with cash. Now is the time to rethink how research can be efficiently harnessed for the good of society. ■
10 October 2009 | NewScientist | 25
Crunch time for pharma It’s time to “liberate” big pharma’s cash mountain. Give their money to the universities, which can make better use of it, argues John Martin MONEY has thrown society out of kilter. Banks that once appeared to have mountains of cash have collapsed. As a consequence of the global recession, governments now recognise that banking is too important to be left to the bankers. States have taken action, from wresting control of financial institutions to introducing new regulations. I believe the financial meltdown has implications for pharmaceutical research. The running of large pharmaceutical companies carries a social responsibility that is as heavy as running any bank. Recently, however, this unwritten contract between society and drug companies has not been fulfilled. Is our health now too important to be left to big pharma? To illustrate my concerns, let’s look at the treatment of heart disease. Many important cardiovascular drugs have been invented: statins, ACE inhibitors, beta blockers, fibrinolytics. But in the last 10 years, few of significance have emerged, even though the pharmaceutical industry has spent unprecedented amounts of money on research and development: in each year of that decade, Pfizer spent about $6 billion, Eli Lilly $3bn, and GlaxoSmithKline $2.5bn. This splurge is reminiscent of how banks misused their funds before their collapse, but the industry has been insulated from the recent economic changes and has accumulated vast cash piles from the sales of medicines (in the UK, mostly through sales to the National Health Service). On average, each 24 | NewScientist | 10 October 2009
top-20 pharmaceutical company economic forces with much has access to about $7.5bn in cash. certainty. The fall of big pharma Could the cash piles of big could be imminent. pharma be mobilised in a more There is another way to efficient way for the public good? fund the development of new Two years ago such a suggestion treatments. Many innovative would have been scorned. Now, ideas that have changed society however, it should be considered. have arisen from the combination As was the case with the banking of curiosity and academic sector, I believe that there is a real freedom found in universities. risk that the big pharma industry This is where small amounts of might collapse. funding can produce big results. Increasing spending on R&D In recent years, university cannot be continued indefinitely research has been exploited by with such meagre progress. If a industry to produce new drugs, collapse of the pharmaceutical industry does occur it might not “I believe that there is a real risk that the be for decades, but one of the big pharma industry biggest lessons of the banking collapse is that no one can predict might collapse”
such as blood clot-busting “tissue plasminogen activator”, courtesy of the Catholic University of Leuven (KUL) in Belgium. Now, while big pharma has so much money it doesn’t know what to do with it, universities are being starved of resources and research funding has decreased in real terms. At the same time, university research strategy is underorganised and there is ignorance of how to exploit intellectual property and utilise patents. Nevertheless, the potential of universities is enormous. Sadly, because of intense competition for limited funds, academic scientists are now driven to perform predictable low-risk science in small packets that will give quick results in time for the next grant application. The end result is that we have a plethora of small groups with strong leaders that act independently, fragmenting effort. At the same time, little translational research is being performed, even though politicians pay endless lip service to the idea. So on one hand we have an unproductive big pharma which is cash rich, and on the other a cash-poor university system that has produced fistfuls of Nobel prizewinners. The way forward is obvious: inject the money into university research. Experience tells us this can have major benefits. One of the most successful initiatives in the last decade has been the spin-out of small biotech firms. My own, Ark Therapeutics, emerged from University College London and
Comment on these stories at www.NewScientist.com/opinion
John Martin is professor of cardiovascular medicine at University College London and founder of Ark Therapeutics
One-minute with...
Don Eigler Two decades on from his landmark achievement of writing “IBM” using 35 xenon atoms, how is nanotech progressing? What made you spell out “IBM” in xenon atoms? Was it just a publicity stunt? Our first experiments actually had nothing to do with atom manipulation, but what they taught us was that we could exert forces on atoms. Then we decided to see if we could reliably reposition them on a surface. Once we had managed to get the atom-moving process under control, the idea just came to me. The biggest challenge was remembering how to spell IBM. What did this experiment mean for science? It has proved to be an extremely powerful scientific tool, changing the way we think about building small structures and how we control things on a small scale. Prior to this it was only through chemistry that we were able to build atomically precise structures. Did it have an impact on the rest of the world? Twenty years ago hardly anybody used the word “nano”. It was not part of our everyday jargon. Now I have an iPod Nano in my backpack. Has nanotechnology trickled down into everyday life yet? To some extent. It’s showing up in coatings, cosmetics and sunscreens, and it’s starting to show up in electronic devices. The length scales at which we manufacture computing devices are at the lower end of the nanometre scale. My laptop and cellphone are chock full of nanometrescale technologies. But I think it’s going to evolve to produce new technologies which will have a much broader impact. What sort of evolution do you have in mind? I like to differentiate between evolutionary technology and revolutionary technology. My cellphone and laptop contain evolutionary nanotechnology because they can be traced back to larger structures. Revolutionary is still very much in the future, but I’m thinking of things like new forms of drug delivery or new kinds of molecular structures. The bulk of the influence
PROFILE Don Eigler is a physicist at IBM’s Almaden Research Center in San Jose, California. He pioneered the use of scanning tunnelling microscopes to manipulate single atoms
on the person in the street is still to come, but there’s a 16-year-old kid out there now who’s going to come up with something really wonderful. What is your take on the health fears surrounding nanotechnology? I have no concerns, but I do have great hopes. I think the beneficial effect of nanometre structures on health is likely to be revolutionary. But I’m also very much aware of the potential toxicological impacts of nanoparticles. My view on this, which is shared by most of my colleagues, is that with testing and an appropriate degree of regulation we’ll be able to reap the benefits with very little in the way of a downside. That would be my hope – getting it right is our responsibility. What are you currently working on? We’re trying to find new ways to do computation in very small structures, something that might be the follow on to the silicon transistor. Our focus is to see if we can do computation using only the spin degree of freedom of electrons. Interview by Duncan Graham-Rowe IBM
is now a public company with three phase-III clinical trials under way. Similarly, Biogen sprang from the Massachusetts Institute of Technology and Genentech from the University of California, San Francisco. Now is the time for government action. Big pharma is international, so measures would ideally have to be taken by the European Commission at the pan-European level, by the federal government in the US or as a joint initiative. Nationalisation, or internationalisation, of the $150bn cash mountain of the top 20 companies is probably unthinkable. However, the tax system could at least encourage pharma to invest more wisely. In the UK, for example, immediate funding could be generated for university research if the Chancellor of the Exchequer were to extend R&D relief for corporation tax to big pharma. But more money is not enough. The universities themselves would have to become more businesslike about how to achieve commercial goals – such as creating a new drug – while preserving their academic freedom. Control must not be allowed to follow the cash, though, or the creative ethos of the university may be stifled. The involvement of small spinoff biotech companies could be a condition of receiving such funding, generating jobs. One hundred new companies could be created from British universities alone over 10 years if big pharma money were blended with a proactive way of recognising patentable inventions and managing university science. The credit crunch has been a vivid reminder of the responsibility that comes with cash. Now is the time to rethink how research can be efficiently harnessed for the good of society. ■
10 October 2009 | NewScientist | 25