GlaxoSmithKline CEO Andrew Witty says the pharmaceutical industry is in a tense and crucial phase of transition during which companies and governments need to find “that new equilibrium of efficiency, value for money, and balanced price versus investment.”

His comments, made during his first address as president of the European Federation of the Pharmaceutical Industry, emphasized the notion of bringing and keeping the industry in step with society’s changing view about what constitutes “value for money” and measuring that value during a time when European governments are pressuring pharmaceutical companies to provide drugs for ever-lower prices.

In the United States, Witty noted, the consequence of price pressure and generic competition is a shrinking of capacity in R&D based ventures. However Europe has been “the biggest net loser,” especially in terms of jobs, research stations, research activity, Witty says. That consolidation is happening was not his complaint.

“The trick,” he says “is to try and get that pendulum to stop swinging at the right moment to recapture an equilibrium where we are able to secure substantial retained jobs, investment in research in Europe,” while still delivering the medicines its society needs.

Strong-arm tactics, such as Novo's short-lived decision to pull its drugs from Greece over price cuts are “not necessarily helpful to the debate,” Witty says.

Brian Ager, director general of the Federation, echoed Witty’s comments, saying it should be a key priority to ensure that cost controls do not impact quality of care or act as a disincentive to innovation.

The research-based pharmaceutical industry provides some 635,000 jobs and 17 percent of R&D investments in Europe, according to the Federation.

Ten years after the first sequencing of the human genome, Witty also took an opportunity to reflect on the accomplishments of R&D efforts since then. Despite the “remarkable amount of new target information in some key diseases,” he says.

“A great mistake everybody made was to think the decoding of the genome would somehow yield a drug. It has nothing to do with yielding a drug, it has everything to do with yielding a whole array of new components and ways of looking at a problem, which together with other things will yield drugs, but it will always take time to make that happen,” he says.