Let’s avoid further stand-offs, says Witty
pharmafile | June 22, 2010 | News story | Research and Development, Sales and Marketing | EFPIA, Greece, industry, pricing
Pharma will need to find new ways of working with European governments in order to avoid further crises as witnessed recently in Greece, according to Andrew Witty.
A war of words broke out between Greece and two pharma companies that withdrew a number of products from the country in protest at enforced price cuts.
Appearing at the European pharma body’s annual meeting in London yesterday the GlaxoSmithKline chief executive and president of EFPIA was asked if it was right for pharma companies to copy Novo and Leo’s methods in Greece as a bargaining tool.
“If I can take my hat off as EFPIA president for a moment, I think it’s terribly poor that that the industry displays actions and behaviours which aren’t empathetic to the challenges of our payers,” he said.
“I think we’ve got to find ways of staying at that table and being constructive – walking away is not necessarily the right step.”
The Greek government’s spiralling budget deficit last month led to its cutting of drug prices, initially by a quarter, to help bring down its rising healthcare costs. This prompted Danish firms Novo Nordisk and Leo Pharma to pull some of their drugs from the market in the crisis-stricken country.
Last week, Novo decided to allow its insulin products back into Greece after the government there agreed to a reduced 10% price cut.
At the EFPIA meeting Witty noted that governments are the industry’s pay-masters and, in the current economic climate, industry will need to find ways of working with them to strike a balance between drug development costs and access to medicines.
Working against each other will not “be helpful to the debate over pricing”, he said.
EFPIA director general Brian Ager echoed Witty’s comments at the meeting and stressed the need for closer working: “I want EFPIA to play a part in addressing the challenges faced by governments in balancing tight budgets against the need to ensure sustainable patient access to high quality healthcare and treatments.
“A key priority is to ensure that cost controls do not impact quality of care or act as a disincentive to innovation. The research-based pharmaceutical industry is a leading high technology industry in Europe, providing some 635,000 jobs and 17% of R&D investments.”
Research and development cuts
In a conciliatory approach, Witty said the industry needed to be careful not to let the trend of moving R&D centres from the West to Asia hinder European innovation in drug development: “The trick is to get that pendulum to stop swinging at the right moment and recapture the equilibrium.”
Witty added that the industry must be re-stabilised to capture the investment and job opportunities in both Europe and newly developed R&D sites such as Singapore and China – a stabilisation that Witty admitted Europe “badly needs”.
Ben Adams
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