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PhRMA’s Hugin Hits Innovation Nail on the Head

July 2, 2013 – In a recent blog post on, entitled “The Ecosystem of Medical Innovation,” Peter Pitts forwarded some “solid directional guidance” from Bob Hugin, CEO of Celgene and the new Chairman of the Pharmaceutical Research and Manufacturers of America (PhRMA).

Hugin states that medical innovation is “the crown jewel of America and its economy,” largely because research entities – companies, academic researchers, government organizations and patient organizations – have taken risks and invested in innovation.

“Bob Hugin clearly sets out how drug innovation has saved lives and improved the quality of lives around the world,” said Coalition for Healthcare Communication Executive Director John Kamp. “But innovation is directly dependent on the profits from the sale of innovative drugs, largely in America,” Kamp continued.

“Public policy experts must respect that if profits are depressed, the source of innovation will be depressed with it. Let’s all get behind Hugin and PhRMA and do a better job of retelling the basic facts of innovation to citizens and their elected leaders,” Kamp said.

The full post from is listed below:

The Ecosystem of Medical Innovation

By Peter Pitts

Solid directional guidance from Bob Hugin, CEO of Celgene and the new Chairman of PhRMA.

Supporting the ecosystem of medical innovation is the most important thing we can do to improve health care for patients with unmet medical needs in the United States.

Medical innovation is a crown jewel of America and its economy.  It has been the greatest source of longer life and economic prosperity in our country and around the world.  In the course of just one decade, from 1999 to 2008, medical innovation brought about a 45 percent reduction in deaths from cardiovascular disease.  Biopharmaceutical therapy for a devastating disease like Alzheimer’s can reduce nursing home admissions by 50 percent.  HIV has gone from an untreatable, fatal disease to a serious but manageable condition.  And in cancer, nearly 50 million life-years have been saved for patients since 1990 because of innovative approaches to cancer prevention and treatment. 

How did we accomplish this?  By working together – large and small companies, academic researchers, government agencies, and patient organizations alike.  By taking risks and investing in innovation.  And those investments have paid off in scientific advancement and economic growth. For example, the US government spent $3.8 billion over thirteen years investing in the Human Genome Project, generating enormous private sector activity.  Every $1 invested in the Human Genome Project created $140 in economic value, repaying the government for its investment via tax revenues many times over, and producing transformative scientific and medical advances for patients. 

We cannot take this ecosystem for granted.  In fact, it is very much at risk.  Short-sighted policies that limit scientific and medical innovation today could negatively affect patients for decades in the future.  Consider Alzheimer’s Disease.  The Alzheimer’s Association reports that without new disease-modifying treatments, by 2050, at least 13.5 million Americans will have developed Alzheimer’s disease, costing this country $1 trillion per year – a crushing expense.  A new therapy that delays the onset of Alzheimer’s by five years would reduce by nearly 45% the number of people with the disease by 2050, and save $447 billion per year.  We cannot afford NOT to invest in the discovery and development of such a potential treatment today. 

So how do we protect the ecosystem of medical innovation?  Fortunately, while the challenges are greater than ever, so too are the opportunities.  We are only at the early stages of being able to capitalize on the revolution in molecular biology and information technology.  With more than 5,000 new treatments in development, the promise and potential of recent scientific and technological advances is enormous.  We must be bold and courageous and stay focused on developing innovations that meet patients’ most pressing unmet needs.  And to do this, we must have a policy environment that supports  innovation, values the entire ecosystem of medical progress – academic medical centers, voluntary health associations, government agencies like the FDA, CMS and NIH, and, crucially, the biopharmaceutical company scientists, entrepreneurs and investors responsible for discovering, developing and bringing to patients the vast majority of new treatments.

Part of a supportive environment for innovation is ensuring that patients have access to the most innovative treatments. New therapies that reduce hospitalizations, promote productivity and improve quality of life have the potential to make real reductions in the overall cost of health care, but access to these treatments is critical.  Medicare Part D is an example of how the public and private sectors can work together to maximize benefit to patients and value to society.  This government supported, privately delivered program based on competition and choice has expanded access for good prescription coverage to 30 million seniors, with 90 percent satisfaction among participants, at a cost more than 40 percent lower than projections, and substantial demonstrated savings in other parts of the medical system.  We must work to protect this model and also ensure patient access to therapeutics in Medicare Part B, other government-funded health programs, and in plans offered through health exchanges.

We can improve health care in the United States by fostering a policy environment that strengthens the ecosystem of innovation, so that working together, we can pursue bold innovations that create longer life and better health for patients.