Dr. Thomas Lönngren, former head of the EMA and today a pharmaceutical consultant, provides some insights on the aftermath of Brexit, describes current challenges the industry is facing and takes a short walk down memory lane on his career journey.
The summer of 2016 will be remembered for many things; record temperatures, terrorist acts in several European cities and a historic shock vote by the Brits, deciding to leave the European Union after 43 years. Brexit shook up the entire world, affecting markets in all areas, and the global pharmaceutical one was no exception. What the larger effects of Brexit will be on the life science industry are yet to be revealed. The consequences depend on how Britain will initiate article 50 (the piece of legislation allowing a country to exit the European Union) and how the negotiations will go with the European Union. But this separation will for sure have consequences for the European regulatory system, which subsequently affects the pharmaceutical industry, Thomas Lönngren, former Executive Director of the European Medicines Agency, notes.
“Such a big change of course creates uncertainty – and no industry wants to live with uncertainty. But it all depends on how the different stakeholders can deal with this uncertainty and continue to run their operations, and there are of course always those that are successful and less successful in these situations,” says Thomas Lönngren.
“The UK is now facing a huge shift with the process of upgrading the British agency MHRA and creating their own laws and systems. For the companies there is a great deal of regulatory administrative work that awaits in order to fulfill the obligations towards both the UK and the EU as dual applications must be made,” says Thomas Lönngren. One of the biggest changes that the European pharma industry is facing is the relocation of the London-based European Medicines Agency, EMA, which Thomas Lönngren headed for ten years.
Officials in Italy, Denmark and Sweden have expressed interest in taking over as hosts. Placing the agency in Sweden would be of great importance for the Swedish life science sector, Thomas Lönngren points out, but he also knows that the location of a European agencies is far from a clear-cut predictable process. During his time at the EMA he was involved in the job establishing new European agencies. One such complex example was during the establishment of the European Food Safety Agency, EFSA. The plan was to locate the new government body in Finland but then protests came from Silvio Berlusconi, the Italian president at the time, arguing that such an organization should be placed in the food mecca Parma, (using the argument that if was located in Finland it would be a frozen food Agency) where the EFSA was indeed established in 2002.
“This shows the difficulty of predicting where EU agencies are placed. These matters end up in the hands of the heads of government, which means that current negotiations with other member states are included in the equation,” Thomas Lönngren explains.
Regardless of which member state will take over, the new location of the EMA will have consequences for the organization and not least for its near 900 employees, Thomas Lönngren’s former colleagues.
“The majority of the staff members come from other member states. What is still unknown is what will happen to them and their families. Hearing about Brexit was of course really sad news for me. During my final years at EMA we worked for a new building that we finally moved into. This feels like a setback now that the agency will have to move, a process that takes careful planning and back up from the member states,” says Thomas Lönngren.
An apothecary’s journey
Thomas Lönngren started out his career as a pharmacist. An interest in chemistry led him to further studies at a technical high school in Stockholm and then to academic studies in Pharmaceutical Faculty at Uppsala University. He got his degree in 1976 and after a few years of lecturing he was recruited to the National Board of Health and Welfare where he became a regulator, focusing on traditional medicines. In the 1990s he also spent several years in Vietnam where he acted as pharmaceutical advisor for SIDA and WHO. He was involved in developing drug policies, GMPs, antibiotic policies, new pharmaceutical factories and creating better access to medicines.
“It was a very interesting and challenging time that gave me a lot of international experience and insight. The country was very closed at the time and then when the market forces came in the healthcare system was shattered, resulting in a transition to private clinics and pharmacies on every corner,” explains Lönngren.
After a time he was appointed Director of Operations of the Swedish Medical Products Agency and later on Director General. In 2001 he took over the position as Executive Director of the European Medicines Agency, a post he would hold over a decade of many transitions.
“It was great fun and a lot of challenges , I had outstanding colleagues and it was an amazing journey to be part of the work that took this smaller, unknown authority to the position of one of the world leading ones,” Lönngren states.
In ten years the agency staff increased from 170 to 850 employees, handpicked from 27 different EU countries. Despite the size of the organization, Thomas Lönngren set out from the start to lead it in a non-hierarchical manner.
“I decided early on to remove the titles and adapted, for this context, a very Scandinavian diplomatic type of style of leadership. To create a consensus in the organization and develop it further,” Lönngren explains.
Back on Swedish ground
He remained in his position for two five-year terms and then made a swift career shift, setting out on his own. Through a sole proprietorship he work and advice within regulatory and market accesses strategy for various clients, mainly as a strategic advisor for the NDA Group a leading global regulatory, market access and pharmacovigilance consultancy. After 16 years of living abroad, Thomas Lönngren moved back to Sweden this spring. A lot of his time is still spent in Boston/Cambridge and in Australia where he is non-executive board member in two medtech companies. NDA group has an office right next to Cambridge Square, Boston, an area that hosts a large biotech community. Even though the US life science is very US focused he notes some interest in Europe and the Nordic region.
“Science is highly reputable in Scandinavia. The knowledge within the Swedish pharmaceutical industry has always had an international influence and Swedish R&D at universities has for a long time been at the forefront,” Lönngren states.
What will be crucial for the Nordic countries to remain strong on the global market is maintaining that fierce position in science but more importantly improving the business mindset.
“What is needed is to bring about an entrepreneur spirit, as well as more people who understand the global pharmaceutical development. The management at the biotech firms need to have that global perspective,” Lönngren says.
The financial part is in the end one of the most important issues to focus on, he emphasizes. The key for the companies is to identify where the money is. A great deal of it is located in the United States.
“In Sweden and Europe there is not the same access to money and in Australia I see the same thing. The capital of smaller Australian firms barely covers a phase I trial, with the result that they have to move the operations to the US to get by. Some companies however have tried a different strategy. Instead of moving the whole business to the US, only part of the firm is transferred. Together with the recruitment of an American CEO, the companies have been able to attain some finances. Perhaps Swedish firms have to go somewhat in the same direction, with a strategic semi establishment in the US,” Lönngren suggests.
The five big hurdles
Thomas Lönngren’s years from the regulatory side and the last five years as a consultant have provided him with a proper overview of what the pharmaceutical sector is facing. In general, the industry, including small to large companies, is dealing with same kind of obstacles, he says. According to Thomas Lönngren, there are five important hurdles to identify. Mother Nature is the first, as understanding the complexity of the human body has become one of the biggest challenges today. Number two is the constant main concern; financing.
“Even though there have been some setbacks on the US market, the preconditions are still relatively good. Nevertheless, financing is often a tough issue for many companies, especially among smaller biotech firms where CEOs or others in the management have to devote much of their valuable time to raising money,” Lönngren states.
A third difficulty is making the regulatory affairs work. According to Thomas Lönngren the companies that get it right from the beginning and have a transatlantic EMA, FDA point of view in drug development often tend to hit good results in the regulatory process, says. But there is still a great gap between those that manage to attain that success and those that don’t.
“When it comes to small and mid-size biotech firms there are few that understand the global challenge from a regulatory perspective. Often, the mistakes are made on fundamental levels, like conducting inadequate studies and research and based on that making the wrong decisions,” Thomas Lönngren believes.
The fourth challenge, and one that Thomas Lönngren has been highlighting for some time now, revolves around health technology assessment. To constantly include the added value and the payers’ demands to generate evidence early in the development process. Remaining competitive is today to a great degree a matter of meeting the multiple needs of payers, he notes.
“This has become well established in Europe now and is starting to spread to the rest of the world, including the United States, where I am closely following the development. The US is now going through the process that European Union member countries did ten years ago; selecting pharmaceuticals based on their health economic value. The large pharmaceutical companies in Europe have understood the importance of developing drugs at an early stage for payers – patients and healthcare – and have thus created the right competence to manage it. A health economic analysis has to be included from the start of clinical trials, where regulatory demands and payers’ demands are considered, to distinguish if it’s worth taking a candidate to the market,” Thomas Lönngren explains.
The fifth and final hurdle is about beating the odds, to go all the way and succeed in an establishment on the market.
“I have seen several new pharmaceuticals that have been approved but didn’t get the expected market share at that time, due to various reasons. The benefit of the drug was perhaps minor, it was to costly or other competing companies stepped up their activities and gained market shares. Even if you get everything right with financing, regulatory affairs and convince payers of the added value, it’s not given that you’ll be successful on the market,” Thomas Lönngren states.
These five hurdles are all connected, Thomas Lönngren concludes, and highlights the importance for pharma and biotech companies of maintaining a comprehensive life cycle view in drug development.
A shift for healthcare
Something that Thomas Lönngren has become concerned about is the changes on the larger, global scale and the recent price development in pharmaceuticals. The difficult equation of ensuring that companies can get return investment for future R&D and finding a way for society to pay for it.
“When I started at EMA there was a crisis on how to come up with new pharmaceuticals. Through the recent developments in science there are now entirely new possibilities. What we are starting to see today is the ability to develop drugs that are disease modifiers, especially within the oncology field and where gene technology and immune technology is going. Should this have a continued positive outcome a possible scenario could be the emerge of a new type of disease modifiers and combination treatments within the next four to five years, making some cancer a chronic disease. The big question is how the healthcare sector will deal with the costs that this brings? This will be a huge challenge for society and I’m not sure that the health care authorities and politicians have understood this, nor have prepared for this development,” Thomas Lönngren states.
Insights from the industry
After five years of working as a consultant, Thomas Lönngren is still happy with his decision to stride out on his own, although he sometimes misses the leadership role. The regulatory knowledge and understanding is of course still there. Being on the other side has provided him with new insights about drug development and the pharmaceutical industry.
“After five years of working with different pharmaceutical and biotech companies, from SMEs to big pharma, I have been able to get a new perspective of the pharmaceutical sector that I didn’t have – and perhaps could have needed – during my time at EMA,” Thomas Lönngren concludes.
There are no plans for retirement in sight, he says. Thomas Lönngren’s plans for the future are to continue work his with NDA Group and other commitments and to keep up the regular US visits, with conferences in New York and San Francisco ahead. Later he will divide his time between Australia and Sweden, hoping to both enjoy the warmer summer period in Scandinavia and reestablish contact with the Swedish biotech industry.
Education: Pharmacy degree from the Pharmaceutical Faculty in Uppsala
Family: Wife Jenny, daughter Camilla and son Dan, both living in London
Role models: “There are many people that I admire for what they have achieved in their area of work. To mention one in the pharmaceutical industry Andrew Witty at GSK needs to get a recognition for what he has achieved in introducing modern thinking and ways to go forward in a rather conservative pharmaceutical industry.”