U.S. academic medical centers have long been the worldwide citadel of pharmaceutical and medical-device research and development, attracting billions of dollars annually in private and public funding. Over the past five years, however, countries such as China and India have begun claiming seats at the profitable R&D table, according to a study released this month.
The studytitled The Globalization of Innovation: Pharmaceuticals: Can India and China Cure the Global Pharmaceutical Market? by the Ewing Marion Kauffman Foundation, Kansas City, Mo.found that major pharmaceutical companies are making significant R&D inroads into emerging markets. These locations, according to lead researcher Vivek Wadhwa, a Duke University professor and Harvard University fellow, are no longer viewed as simply good spots for sourcing raw materials and inexpensive manufacturing. Skilled scientific workforces, significant government investments into the healthcare and R&D infrastructures, and less-stringent restrictions on areas of study such as stem-cell research are prompting drug companies to increase their R&D spending and presence in these countries.
When we went to India and China, we were completely blown away by the level of development, says Wadhwa of his research for the foundation. Every multinational (drugmaker) is there, and theyre doing everything from low-level clinical trials to high-level chemical development.
Drugmakers AstraZeneca, Merck & Co. and Pfizer, along with devicemakers Hill-Rom Co. and Medtronic are among the long list of multinationals setting up R&D facilities and partnerships in these and other big developing markets, according to the Kauffman Foundation study and other sources. But while the changing R&D landscape is generally seen as a positive move toward ending worldwide healthcare disparities and rebuilding the nearly exhausted drug and medical-device pipelines through more diverse innovation, the trend is also likely to have a significant effect on the amount of R&D funding going to U.S.-based medical schools and research institutions.
Theres a downside to hospitals and medical schools here, because at the very same time that Big Pharma is upsizing overseas, theyre downsizing here: Its two sides to the same coin, Wadhwa says.
Whats more, lack of experience with clinical-trial protocols, concerns over intellectual-property protection and a diminishing, yet still existent, concern over potential scientific abuses within these emerging markets could potentially place the entire drug and medical-device supply chain at risk for defective products, research experts say. A report from the India Planning Commission noted that the country has a looming shortage of clinical research personnel estimated at 30,000 to 50,000, according to the Kauffman study. As a result, a growing number of U.S. medical institutions are using their expertise to get into the global-research game and build partnerships that expand their funding resources and influence on worldwide R&D activities.