Mixed results for Australia in the 5th report of the 'Building the Bioeconomy' series supported by US-based Bio.
Bio is the US-based representative association of the country's biotechnology industry.
"Regulations need to strike a balance between protecting users and stimulating innovation, incorporating sufficient guarantees without dampening economic efficiency," says the report.
"More than in other industries, for biotechnologies the interplay between innovation and regulation has important social and ethical implications."
Australia has ranked 13th for 'biotech' and 'policy' inputs in terms of countries with the most attractive policy environments and accompanying high levels of biotechnology outputs.
New Zealand is ranked 17th.
The top three countries in order are the US, Denmark and Ireland. Other countries ahead of Australia are Switzerland, Singapore, the UK, Sweden, Japan, Israel, Korea, Taiwan and Finland.
According to the report, "Many mature markets are not resting on their laurels either, and are pushing through approval reforms meant to increase their performance and attractiveness.
"In Australia a provisional approval pathway for NCEs and new uses on the basis of early clinical data on safety and efficacy was launched in March 2018."
The report highlights the UK's Accelerated Access Pathway for transformative innovation.
"An Accelerated Access Collaborative will coordinate the selection of five drugs or medical devices to be fast-tracked for reimbursement, meaning NHS uptake could happen years earlier," it says, without mentioning the current PBAC submission pathway work currently underway in Australia.
Australia also wins plaudits for a strategic policy focus on precision medicines and genomics.
However, its ranking is impacted by a range of other issues, including the GM canola moratorium from 2004 to 2014, which the report says cost farmers nearly US$500 million in lost revenue, as well intellectual property and reimbursement.
"Australia’s market-size damages policy unfairly tips the scales in commercial patent disputes and creates an inappropriate conflict of interest by permitting the same government that examined and granted a patent to seek damages if that patent is later ruled invalid or not infringed. Achieved a score of 78.19% on the IP Index life sciences indicators."
There have been four market-size damages cases to date or ongoing where the government has sought compensation from companies related to PBS spending on medicines where patents have subsequently been found to be invalid.
One case heard by the federal court is awaiting judgement. Two others have been settled in favour of the federal government and another case is yet to be heard.
The report describes Australia's reimbursement environment as "generally challenging".
"Number of product registrations relatively low and number of products included for reimbursement on PBS is low compared the (sic) high-income developed world averages.
"A 5-year agreement between the Department of Health and Medicines Australia was signed into law in 2018. It establishes price cuts that will deliver savings of USD1.8 billion at the condition that no further price reforms be undertaken up to 2023, and that savings be reinvested in drug purchase. Price cuts include a 5% statutory price reduction for drugs listed in the single-brand formulary for 5 years; a further 10% after 10 and 5% after 15 years."
On New Zealand, the report says it "stands out" as a market whose policy conditions underperform vis-à-vis R&D capacities.
"Some key policy challenges remain and help explain the divide between R&D capacities, with for instance a high number of scientific publications per million population, and attractiveness to investors. These include stringent pricing and reimbursement measures for biopharmaceuticals and – compared to leading markets – limited IP standards."
It adds, "For instance, from 2010 to 2015 New Zealand funded only 12 new medicines and innovative biologics compared to 66 in Australia. Finally, drugs recommended for funding undergo reimbursement delays of up to 6.75 years including those labelled as ‘high priority’."
"The example of New Zealand underscores the importance of a holistic approach to policymaking. It is worth asking how much greater biotech outputs in New Zealand could be if positive policy reforms cut across all enabling factors," it says.