Yahoo Finance GSK boss warns UK life sciences at ‘tipping point’ despite Sunak’s R&D pledge
The boss of Britain’s second-biggest pharmaceutical group, GSK, has warned the UK is at a “tipping point” and risks falling short of government ambitions to become a life sciences superpower despite Rishi Sunak’s pledge to ramp up spending in research and development.
On Wednesday, Emma Walmsley called for improvements in three key areas, saying the UK needed to reverse the decline in clinical trials, speed up regulatory approval for new treatments and deploy the latest medicines more rapidly.
“It is very clear there is a big opportunity for the UK in life sciences, not least in pre-patient care,” she said. “But we are at something of a tipping point if we don’t make the right decisions now. We really do have to start to close the execution gap, and align the strategy and the opportunity to the delivery.”
Walmsley was speaking as GSK, formerly formerly GlaxoSmithKline, reported better-than-expected results for 2022, with sales up 19% to £29.3bn, boosted by its shingles vaccine Shingrix. The company, which spun off its consumer health business Haleon last summer, posted a 56% rise in pretax profits to £5.6bn.
Sunak vowed to make Britain a “science superpower” during his unsuccessful Tory leadership campaign last August, pledging to create a UK alternative to the EU’s flagship research programme Horizon Europe. During his time as chancellor, he also promised to increase public and private sector investment in R&D as a central way to boost the productivity of the British economy.
In the autumn statement, his government reaffirmed its commitment to raise R&D spending by a third to £20bn a year by 2024-25. However, it also cut R&D tax credits for smaller companies.
“Everybody recognises the importance of life sciences to the UK and there is very broad agreement on the strategy that we need to follow and that includes the highest levels of government,” Walmsley said. “It’s just time to deliver on it.”
She said GSK understood the “financial and short-term operational pressures” the NHS was under and that it was “really important to engage constructively and in the interests of patients”.
Her intervention comes at a crucial time for life sciences, with the NHS struggling to reduce waiting lists for the most basic treatments and signs that big pharmaceutical companies may be retrenching their activity in the UK.
Walmsley said it was important to turn around the UK’s declining number of clinical trials relative to other countries, which was “definitely a concern”,” and to ensure continued investment from multinationals. But she added that GSK remained committed to the UK. The government is now carrying out a review into clinical trials.
The GSK chief executive said the UK must also become faster at deploying innovation. For example, she said it could take “some years” before the company’s new RSV vaccine is available in the UK, while it is expected to be approved in the US this year.
Citing the vaccine, Walmsley said: “There’s a whole new wave of vaccine technology that’s coming which we would love to see this country and Europe right at the forefront of deployment of.”
Finally, Walmsley said a lot could be done to support Britain’s Medicines and Healthcare products Regulatory Agency to speed up decisions and get medicines faster to patients.
This could be achieved by making sure the MHRA was “properly resourced to address the backlog and provide the right kind of timely advice and approval for clinical trials”, she said, adding: “It wouldn’t take much to make a big difference here.”
Walmsley and Pascal Soriot, the chief executive of Britain’s largest pharma group, AstraZeneca, were co-signatories to an industry letter sent to Sunak last week.
They warned against the NHS sales levy, a voluntary agreement under which drugmakers pay rebates on sales of branded medicines to the health service if its spending on drugs rises by more than 2% a year, saying it was undermining investment. They called for “urgent resolution” to make the country internationally competitive and to “prevent an acceleration in pharmaceutical disinvestment from the UK”.
GSK invests about £1bn a year on R&D in the UK, roughly a fifth of the company’s total spending, and has its global R&D hub in Stevenage. It recently expanded its Barnard Castle factory in north-east England, but is also investing globally, for example in Singapore.
This year drugmakers will be obliged to return almost £3.3bn in sales revenue to the government, up from £600m in 2021 and £1.8bn in 2022 under the voluntary pricing agreement, and the US drugmakers AbbVie and Eli Lilly have recently pulled out of the scheme.
Laura Steele, the president and general manager for Eli Lilly’s Northern Europe division, said at the time: “The current scheme has harmed innovation, with costs spiralling out of control, and the UK is falling behind other major countries to be left as a global outlier.”
