International report urges pharmaceutical industry to invest more in nanotechnology

Brussels, 17 Feb 2005

While EU governments are making funding available for nanotechnology research, major pharmaceutical companies are investing very little money or human resources in this field, according to a new report.

The report, 'Why big pharma is missing the nanotech opportunity', written by Lux Research, claims the failure to invest in nanotechnology exposes the top pharmaceutical companies to strategic risks as other industries invest in this technology.

'Nanotech presents many opportunities to pharmaceutical giants, ranging from better delivery of existing drugs to entirely new therapies based on nanomaterials,' says Matthew Nordan, Vice-President of Lux Research. 'But big pharma is not investing in nanotech today. If this trend continues, nanotech will play out in pharmaceuticals just as biotechnology did, with major pharmaceutical companies leaving money on the table and allowing new competitors to take root,' he adds.

During the so-called 'biotech revolution' the major pharmaceutical companies in-licensed drugs from start-ups at a later stage in order to avoid early investment. However, given the increasing pressure on the pharmaceutical industry's drug pipeline, the European pharmaceutical industry, for example, increased its spending on research and development (R&D) from some 11.2 billion euro in 1995 to more than 20 billion euro in 2002. This later stage investment, however, came too late for the supply of new medicines into research pipelines. The result is that number of new medicines launched on the market has declined from an average of almost 40 a year in the 1990's to just over 20 since 2000.

According to the report, nanotechnology could help solve the industry's pipeline problems by improving the delivery and efficacy of developmental and marketed drugs, while new nanomaterials could develop into novel treatment strategies in the form of biologically active implants.

Yet, according to the report's findings, based on interviews with nanotechnology experts from 33 global corporations, 'big pharmaceutical companies on average commit 16 people and less than half of one per cent of R&D spending to nanotechnology research, whereas like-sized electronics and materials firms commit more than 100 people and more than 8 per cent of [their] R&D budget.'

This contrasts sharply with the scale of funds invested into nanotechnology by some countries. Indeed, the potential and importance of this technology was recognised early by EU governments. Most recently, Germany made a 50 million euro fund available for start-ups in the 'bionanotechnology' field as part of the Nanotechnology for Health and Society (NanoforLife) programme. Similarly, in 2004 France increased its funding for nanosciences and nanotechnologies to 70 million a year over three years and in 2003 the UK earmarked 90 million GBP (130 million euro) to its micro and nanotechnology manufacturing initiative.

CORDIS RTD-NEWS / © European Communities
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