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May 09, 2014

JobWatch: PhRMA Warns U.S. Could Lose 149,000 Jobs

New report offers ideas from pharma execs for policy changes to thwart potential cuts.

JobWatch: PhRMA Warns U.S. Could Lose 149,000 Jobs

In this regular feature, GEN keeps track of the biotech job market. This month’s JobWatch discusses a new PhRMA report on biopharma jobs in the U.S. [© Maksym Yemelyanov - Fotolia.com]

  • The U.S. stands to lose up to 149,000 jobs over the next decade unless Washington enacts industry-friendlier policies that Pharmaceutical Research and Manufacturers of America (PhRMA) contends will foster biopharmaceutical innovation.

    PhRMA says employment across biopharma would shrink 4.5% under such a “status quo” scenario, compared with the retention of those jobs plus creation of 185,000 additional jobs—a total 334,000 jobs—if pharmaceutical manufacturing employment grew 4.8% from 2012–22, as forecast by the U.S. Bureau of Labor Statistics (BLS).

    PhRMA makes its case for regulatory relief in “The U.S. Pharmaceutical Industry: Perspectives on Future Growth and the Factors That Will Drive It.” The report details results from a Battelle-developed survey of an unspecified number of “senior-level strategic planning executives” from companies representing about 75% of U.S. biopharma sales. The executives were questioned about leading factors that according to the report “would be most significant in improving the business operating environment in the U.S. and result in generating higher growth for the U.S. biopharmaceutical industry.”

    The executives highlighted three policy goals they deem critical to U.S. competitiveness in biopharma innovation:

    • Coverage and payment policies that “value and support the use of new medicines”
    • A well-functioning, science-based regulatory system
    • Strong IP protections in the U.S. and abroad

    “In order to make progress, we need a policy framework that supports the long and uncertain process of developing treatments by sustaining a robust research enterprise that encourages innovators to take risks and accept the inevitable scientific setbacks,” PhRMA spokeswoman Jenni Brewer told GEN.

    “Public policies need to recognize these investments in order to encourage continued innovation for patients. Furthermore, insurance models need to be re-aligned to recognize the tremendous long-term value of specialty medicines and ensure patients have meaningful access to the care they need,” she added.

    That tremendous long-term value carries with it a sizeable cost, especially for many newer drugs that fetch six figures or close to it per course of treatment. Patient groups and some politicians complain such prices deprive most Americans of access to life-saving new medicines. Brewer and PhRMA cite the industry need to recoup expenses: “Progress against complex diseases and conditions would not be possible without substantial investment in research and development, which is an extremely lengthy, complex, and costly process.

    The cost of drugs includes the compounds that fail. According to PhRMA, drug developers have had 101 unsuccessful attempts to develop medicines for Alzheimer’s disease since 1998. Only three compounds have been approved, all of them treatments for symptoms of the memory-robbing ailment.

    PhRMA was among industry groups that in recent years pressed for reforms designed to speed up FDA reviews. Many of those changes were included within the Food and Drug Administration Safety and Innovation Act (FDASIA) of 2012, which includes the fifth authorization of the Prescription Drug User Fee Act or PDUFA.

    FDA last year didn’t see much benefit from user fees, which, like federal budget funds, were sequestered.

    “We hope that with the restoration of the sequestered FY 2013 user fees in January, the Agency will prioritize the implementation of the regulatory science goals outlined in the PDUFA V Performance Goals Letter,” Brewer said. Those goals include advancing meta-analysis methodologies, developing patient-reported outcomes, and increasing use of biomarkers and pharmacogenomics.

    As for IP, PhRMA is among industry groups fighting the Obama administration over its unsuccessful attempts in its annual budget proposals to cut from 12 to seven years the exclusivity period for biologics. While Congress has beaten back those efforts, Brewer said, “The concern is the potential confusion and uncertainty resulting from the administration repeatedly calling this provision of U.S. law into question.”

    She offered one example: The administration’s stance could undermine biopharma’s effort to secure at least 12 years of exclusivity in the proposed Trans-Pacific Partnership trade agreement.

  • COUNTING: Regional Reports Tally Jobs

    Three groups promoting biopharma or broader science and tech clusters released reports over the past month highlighting industry or academic activity in specific regions:

    Southeastern North Carolina: Separate from its national policy study (see above), PhRMA issued a report April 28 citing BLS statistics showing 3,950 life sciences jobs—up more than 24% since 2006—in the nine southeastern North Carolina counties anchored by the cities of Fayetteville and Wilmington, thanks to a growing community of contract research organizations or CROs. Over 40% of those jobs come from PPD, the region’s largest CRO with 1,600 employees at its Wilmington headquarters among 13,000 worldwide.

    “Research in Your Backyard: Pharmaceutical Clinical Trials in Southeastern North Carolina” also reported that nearly 500 clinical trials of new medicines took place in the region since 1999—of which half focused on six chronic diseases: asthma, cancer, diabetes, heart disease, mental illness, and stroke. The figure includes 25 chronic-disease drug trials that are active and recruiting patients.

    Austin, TX: The “Live Music Capitol,” home to festivals like South by Southwest (SXSW) and of course, Austin City Limits, is also a metropolitan statistical area with more than 6,000 biopharma and other “life sciences” jobs within 206 establishments, according to a report released May 1 by a regional business group.

    The Austin Technology Council’s “Economic Impact of the Life Sciences Sector” found three quarters of the region’s life-sci jobs consisted of just three categories—R&D in physical, engineering, and life sciences (2,364 jobs in 94 establishments), pharmaceutical preparation manufacturing (1,156 in seven), and R&D in biotechnology (1,099 in 63).

    Interestingly, employment has stabilized at 6,000 jobs since 2011 after growing in the ‘90s, shrinking after the dot-com bust of 2000, growing again from 2004–08, then shriveling during the recession.

    Washington state: The University of Washington (UW) and Washington State University (WSU) issued a joint report last month showing that their combined 18,000+ life sciences jobs accounted for more than half of the 35,270 “life, physical, and social science” positions reported in May 2012 by BLS.

    UW accounted for most of those life-sci jobs—15,674 full-time equivalent (FTE) life-sci positions ranging from research and clinical care to teaching and administrative positions. The remaining more than 2,400 FTEs worked at WSU. Both universities spent $869.8 million on life-sci R&D, generating about $2.4 billion in state economic activity, the report found.

    “The commitment of public and private partners to life sciences research in Washington state’s academic institutions is clearly an investment that appreciably improves lives around the world—and pays dividends close to home,” the report concluded.

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