The innovation powerhouses behind the COVID-19 vaccines
The pharmaceutical sector is no stranger to innovation. From the discovery of Penicillin in 1928 to the Polio vaccine in 1953 and insulin injections in 1982, there have been hundreds of game-changing pharma breakthroughs throughout the last few centuries.
Never has this been more apparent than in recent weeks and months as pharmaceutical companies have rallied and worked around-the-clock to pioneer solutions in the fight against the COVID-19 pandemic.
At the time of writing, three vaccinations are approved for UK-use:
- University of Oxford-AstraZeneca
A fourth COVID-19 vaccine, known as the Novavax jab, is currently being assessed by the Medicines and Healthcare products Regulatory Agency (MHRA), and a fifth has been developed by Johnson & Johnson, also pending UK approval.
For now, let’s take a closer look at the main innovation powerhouses behind the trio of vaccines being widely administered across the UK.
Innovation powerhouse 1: Pfizer
In 1849 cousins Charles Pfizer and Charles Erhart founded Charles Pfizer & Company in Brooklyn, New York. Since then, the company has steadily grown from strength-to-strength on a global scale, becoming the world’s largest producer of Penicillin, developing cutting-edge solutions for animal healthcare, introducing an injectable antibiotic, and being named as one of the most admired pharmaceutical companies in the world.
Their innovation footprint
R&D budget: $8.65 billion
Change from 2018: +8%
Total 2019 revenue: $51.8 billion
R&D budget as percentage of revenue: 16.7%
Just one glance at Pfizer’s illustrious history and it’s clear to see that sustained investment in – and commitment to – R&D has fuelled their direction and enabled them to become the company they are today.
As early as 1955 they opened a fermentation plant in the UK that set the foundation for their research and development operations in Great Britain, and in 2003 they invested more than $7.1 billion in R&D alone.
In 2010 they unveiled a diversified R&D platform called Pfizer Worldwide Research and Development, and just eight years later were spending £270 million on R&D in the UK.
Innovation powerhouse 2: AstraZeneca
Astra AB was founded in 1913 in Sodertalje, Sweden as an attempt to help Sweden compete with German and Swiss medicine. By 1929 the company had become profitable, and in the 1930s it ventured into the field of independent research by developing drugs such as Hepaforte, an anti-anaemic medicine.
Astra AB became a global phenomenon when it developed the blockbuster numbing agent Xylocaine (lidocaine) in 1948. The success that followed enabled the company to invest more money into research, and over the years the company continued to expand and push new boundaries.
In 1998 Zeneca bought Astra for $35 billion, creating the fourth-largest company in the world.
Their innovation footprint
R&D budget: $6.06bn
Change from 2018: +2.1%
Total 2019 revenue: $24.4 billion
R&D budget as percentage of revenue: 24.8%
In its own words, AstraZeneca is, ‘driven by science, united by science, and every day, push the boundaries of science to deliver life-changing medicines.’
Such is AstraZeneca’s commitment to researching and developing new medical advancements that it has its own dedicated research and development arm, AstraZeneca R&D, along with three dedicated R&D centres – in Cambridge, UK; Gaithersburg, USA; and Gothenburg, Sweden. In fact it has an active R&D presence in 40 other countries.
Its latest R&D facility, at the Cambridge Biomedical Campus, is set to become its largest R&D centre in the UK, with more than 2,000 people working across therapy areas, drug discovery platforms, development and commercialisation. Over 10,000 employees work exclusively in R&D company-wide.
Innovation powerhouse 3: Moderna
R&D budget 2020: $1.37bn
Change from 2019: +176.2%
Total 2019 revenue: – $747 million
R&D budget as percentage of revenue: 183.4%
Moderna was founded in 2010 in Massachusetts, with the main core of its activities being centred around drug discovery, drug development and vaccine technologies using messenger RNA.
The company, which currently employs more than 1,300 staff, specialises in several key areas; immune-oncology and infectious immune-oncology, and rare cardiovascular and autoimmune diseases. Its partners include pharmaceutical, biotech and science and technology pioneers, including AstraZeneca, Merck and Lonza, and it was through partnerships that the Covid-19 vaccine was developed – in collaboration with United States National Institute of Allergy and Infectious Diseases (NIAID) and the Biomedical Advanced Research and Development Authority (BARDA).
Moderna reported financial losses for the year-end 31 December 2020, however they’re a young company largely focused on biotech innovation that hadn’t bought an approved medicine to market before the Covid-19 vaccine.
Their innovation footprint
Although always fundamentally an R&D business rather than a commercial one, the success of the vaccine development meant even heavier investment in R&D in 2020, particularly in people needed to support the development and commercialisation of the Covid-19 vaccine.
Moderna has it’s own ‘Research and Innovation Engine’ dedicated to spearheading continued RNA breakthroughs and over the years has built a leading mRNA technology platform to help them realise their vision of delivering ‘a new generation of transformative medicines’.
As a result of the US’s ‘Operation Warp Speed’, a group designed to accelerate the development of a vaccine for the coronavirus, the federal government invested $483 million in Moderna which will obviously continue to push R&D to the next level.
The future of pharmaceutical R&D in the UK
Overall R&D spending in the UK pharmaceutical sector grew from just £306 million in 2012 to £4.8 billion by 2019 according to the ONS – the largest growth in expenditure on R&D of any surveyed sector – so the dedication to R&D in the UK is strong.
And while Pfizer and AstraZeneca are no doubt innovation powerhouses, they weren’t even in the top three in terms of global R&D spend in 2019 by pharmaceuticals companies.
Beyond these behemoths, let’s not forget the work that thousands of smaller life sciences companies undertake and the advancements constantly happening at every level of healthcare.
These companies are absolutely perfect candidates for claiming Research and Development tax relief, and we’d love to help more of them reap the rewards of constantly discovering new and amazing ways to keep us alive and well.
If you work in life sciences get in touch today to tell us about some of the great work you’ve been doing and we’ll see if we can help you claim tax relief on your R&D spend.Contact us