Spanish Drugmakers Cite Rising R&D Costs, Urge Government Aid

Leading research-based drugmakers with R&D operations in Spain have called on the government to provide "selective assistance" for the industry's drug development activities. Although the government has identified pharmaceuticals as a strategic sector, official aid has been negligible in comparison with other European states such as the UK, which has budgeted more than GBP3bn (US$5.64bn) this year in assistance to the biotech sector alone.

With drugmakers claiming that the cost of bringing new drugs to market has risen tenfold since 1975 to some EUR1bn (US$1.3bn), Spain's government may finally be obliged to take action. Indeed, recent data indicates that private Spanish investment in the cost-intensive biotech sector totalled only EUR49.3mn (US$65.1mn) in 2004, with local sector leader Neuropharma accounting for 85% of this total.

In a further headache for the industry, Spain's new pricing policy has been widely criticised as overly harsh, with representative groups claiming that the latest cuts will cost the sector as much as EUR1bn (US$1.34bn) by 2007. However, with a fast-ageing population and a reimbursement system that has already led to among the lowest drug prices in the EU, the government's continued eagerness to restrain spending is likely to figure prominently in its plans for the sector.