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by Alison Culpan, ABPI Scotland
28 March 2023
Associate Feature: New report demonstrates the value of Scotland’s pharmaceutical industry, but we mustn’t be complacent

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Associate Feature: New report demonstrates the value of Scotland’s pharmaceutical industry, but we mustn’t be complacent

The pharmaceutical industry continues to be a significant contributor to the Scottish economy and a key player in Scotland’s life sciences sector, according to an independent report from the University of Strathclyde’s Fraser of Allander Institute (FAI). 

The report, ‘The economic contribution of the pharmaceutical sector in Scotland,’ shows a significant increase in total turnover for pharmaceuticals manufactured in Scotland from £690 million in 2019 to £1.65 billion in 2022, having risen to a peak of £2 billion during the height of the pandemic in 2020. GVA per head of employment in the manufacturing of pharmaceuticals industry was almost £200,700 in 2020, more than double its nominal value in 2015 and significantly above the Scottish industry average of £60,000.

However, while the sector continues to do well in Scotland, there are also warning signs that tougher times lie ahead. Pharmaceutical exports contracted between 2018 and 2019, from £570m to £500m, largely due to falls in exports to the rest of the UK (down from £155m in 2018 to £50m in 2019), and there has been a slight decrease in total employment in the wider pharmaceutical industry.

The ABPI believes that the Scottish Government needs to take action to maximise the sector’s potential and secure more sustained long-term economic benefits. 

To remain competitive, Scotland needs to focus on improving the environment for clinical trials. Clinical trials have been struggling for several years in Scotland and across the rest of the UK. A recent ABPI report found that the number of clinical trials initiated in the UK per year fell by 41% between 2017 and 2021.

Clinical trials are an essential part of the research and development of new medicines and vaccines, bringing benefits to patients, the NHS and the economy. Clinical research benefits our economy enormously—it creates jobs and generates much needed income and savings for the NHS, ultimately helping NHS finances to go further while improving patient care and services through the development of new drugs and treatments. 

Reduced access to industry clinical trials – including those developing potentially lifesaving or life-enhancing new medicines and vaccines – has significant consequences for patients. This has particularly serious implications for the health outcomes of patients with limited treatment options in routine care, such as people living with rare diseases.

Whilst Scotland has the infrastructure, science base and skills to retain - and build - its position as a world-leading hub for medicines development and discovery, it needs to act swiftly to fend off competition from countries like Spain and Estonia who have become more adept at attracting clinical trials. By improving our data capability, we have the opportunity to turn the tide on clinical trials in Scotland.

The PwC report, Life Sciences Superpower, shows the opportunities that investment in life sciences can bring to patients, the NHS and the economy. It calculates that by improving the UK’s share of global commercial clinical trial enrolment to levels consistent with leading countries, like Spain, around £165 million in additional revenues and £32 million in additional savings for the NHS could be achieved across the UK each year.

The Fraser of Allander Institute’s report illustrates how vital our industry is to the economy and the positive impact it has on the lives of people across all of Scotland.

Scotland has proved that it has the skills and infrastructure required for a thriving pharmaceutical sector, but the Scottish Government must now capitalise on this to avoid losing out to other countries. Challenges around the delivery of clinical trials, data access and the deterioration of the wider UK commercial environment for life sciences could spell trouble unless decisive action is taken to ensure Scotland can fully realise the sector’s potential. 


This article is sponsored by ABPI.

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