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A new report from PhRMA outlines potential growth trajectories affecting the biopharmaceutical industry.
The Pharmaceutical Research and Manufacturers of America (PhRMA) released a report that outlines two potential growth trajectories for the US biopharmaceutical sector. Developed by the Battelle Technology Partnership Practice, the report finds that coverage and payment policies, a science-based regulatory system, and strong intellectual property (IP) protections drive US leadership in biopharmaceutical innovation, and if negative trends in these key policy areas continue, jobs supported by the industry would decrease over the next decade. However, if reasonable pro-innovation policies are pursued, the biopharmaceutical sector stands to retain and addover 300,000 jobs by 2021. The report combines quantitative data with inputfrom industry leaders.
As the ability to innovate is increasingly becoming the most important determinant of a nation’s future potential for economic growth and global competitiveness, the biopharmaceutical industry stands out among manufacturing industries as an example for future economic growth, the report says. Currently, the biopharmaceutical industry supports a total of 3.4 million jobs across the US economy, including over 810,000 direct jobs, contributes $789billion in economic output, and is responsible for about one in five dollars spent on R&D by US businesses. To put into greater context, biopharmaceutical companies invested more than nine times the amount of R&D per employee than manufacturing industries overall from 2000 to 2010.
Not only have PhRMA member companies invested an estimated $51.1 billion in R&D in 2013, representing the majority of all biopharmaceutical R&D spending in the US, but the medicines developed by the industry play an important role in helping control other health care costs. For example, theCongressional Budget Office recently adopted a scoring change that credits Medicare policies that increase use of medicines with savings on other Medicare costs. Similarly, Harvard researchers report savings on hospital and nursing facility costs of about $1200 per newly insured Part D beneficiary in 2007.This equals overall Medicare savings of $13.4 billion, more than one quarter of Part D’s total cost during the program’s first full year.
Source: Pharmaceutical Research and Manufacturers of America