A lecture, on the economics of developing new drugs, particularly in relation to whether this should be a national or private enterprise. I have chosen to address myself to a more positive issue. This is the extraordinarily fruitful way in which the relationship between the privately owned pharmaceutical companies and the government and universities has evolved in Britain and a few other countries. This evolution has resulted in a partnership which has been remarkably effective in developing, assessing and introducing new methods of preventing and treating disease.
The Office of Health Economics was invited to make a contribution to the celebration of the Golden Jubilee of the ABPI. This booklet is our response. In it we have broadly surveyed British pharmaceutical progress through the last fifty years. We have had to do so within limits of space and time which have constrained our text in two main aspects.
Since this monograph was completed, two new stories concerning the safety of medicines have been featured prominently in the British press. The first has been on an American legal case in which damages have been awarded because a medicine taken during pregnancy was alleged to have caused congenital malformations. The second has been based on the fact that the benzodiazepines, when taken for prolonged periods in high dosage, may carry the risk of causing dependency.
In the financial year 1976-77 over £220 million was spent on health care research in the United Kingdom. Taking account of recent expenditure growth and making an allowance for less readily identifiable contributions it may be estimated that total health care research spending is currently approaching the £300 million mark. In real terms this is an almost twofold increase on the £80 million (£172 million at 1976 prices) recorded at the beginning of the decade.
It has not normally been OHE policy to reprint articles which have previously been published elsewhere. However, it seemed desirable to make an exception for this paper by Dr Klaus von Grebmer which has been published in two parts in German in Die Pharmazeutische Industrie. This is because it is a useful compilation of many arguments relating to pharmaceutical pricing, which deserves to be available in the English language as well as in German.
To present a balanced view of the brand name/generic controversy and the associated field of bioavailability. Many have discussed these problems; scientists, politicians, industrialists, legislators, hospital pharmacists, physicians, and clinical pharmacologists.
The physical health and longevity of the people of countries such as Britain has improved dramatically during the course of the past 100 years. In the middle and later decades of the 19th Century the average Englishman had at birth a life expectancy of around 40 years. Today it is nearly 70 years. In 1898 the pioneer social investigator Seebohm Rowntree recorded in a survey in York an infant mortality of 247 per 1,000 live births amongst the poorest class and one of 94 per 1,000 amongst the well-to-do.
Out of £868 minion spent on the revenue account of the hospital service in England and Wales in 1970, £242 million, or a little over one quarter, was spent on supplies of goods and equipment. Table 1 shows the breakdown of spending by the nine broad categories which have been used for accounting under the National Health Service. These are the only comprehensive data available at the national level, though they are unable to reflect the diversity of medical and non-medical goods purchased, from boiler fuel to pharmaceuticals and from food to surgical instruments.