Science & Technology Committee:

Response by Alzheimer’s Research UK

August 2015

Declaration of Interest:

Alzheimer’s Research UK is the UK’s leading research charity aiming to defeat dementia. We fund world class studies that give the best chance of beating dementia as quickly as possible, and our pioneering work focuses on understanding, preventing, treating and curing the diseases that cause dementia. We are energising a movement across society to support, fund and take part in dementia research. Our vision is a world where people are free from dementia.

Alzheimer’s Research UK is not a recipient of Government funding through the Science budget, or any other funding stream. However, we do fund grants and projects that occur in partnership with other funders, including NIHR and MRC.

Key Points:

  • The ring-fence protects the science budget from annual budget variability, which is important to the research environment in the UK.
  • Medical research is one of the most beneficial areas in which to invest.

Significant investment that increases steadilyincentivises further investment in the sector and ensures the greatest benefit to innovation and economic growth.

Improving health outcomes through research reduces the strain on other areas of Government expenditure.

  • Increasing spending in the science budget would have a positive effect in the instance of dementia research, where the cost to the UK economy is high (> £26bn).
  • The UK has cutting edge infrastructure and a knowledgeable workforce in dementia research that is supported in part by the Science budget,and should remain a globally competitive funder of research.

Introduction

When reviewingGovernment investment in scientific research, consider that it is a field that is quick to suffer from of cuts, and slow to recover when funding levels are restored. This is because research, and particularly medical research, is built on incremental victories, and developing the environment and expertise to produce results takes a long-term commitment. The UK is rich with research potential[1], but funding instability could hurt the environment, slowing economic growth and interrupting progress against some of the greatest challenges of our time. Having inflation-proofed the capital budget up to 2020-21, it is essential that the Science budget supplies the funding to make the best use of the UK’s scientific research infrastructure. Alzheimer’s Research UK supports a ring-fenced Science budget with funding that increases year on year to align with capital allocations, to support other Government, charitable and private investment, and to secure the UK’s leadership in scientific research internationally.

Response to the Committee’s questions:
[To what extent have] the current ring-fence arrangements, and the separate arrangements for determining 'resource' and 'capital' allocations… produced coherent UK science and research investment?

  1. The UK has a strong research environment, but funding instability could hurt it, slowing economic growth and delaying progress in fields like medical research. The economic and societal benefits of a robust research environment that makes advances, such as improved health outcomes, can only be realised through continued support and investment[2].
  2. Reliable funding, protected by the ring-fence of the Science budget has been beneficial to both the research environment, and a skilled workforce. Stable funding levels allow research bodies to develop people in the field, and allow for career progression. This is particularly pertinent in dementia research, which is growing but has been underfunded and therefore needs continuing support to significantly increase capacity. Protection of the Science budget through the ring-fence has been particularly vital as Departmental R&D budgets have remained unprotected through the 2010-2015 Parliament and been reduced dramatically[3]. Now that significant investment has been committed to capital investment, it is critical that the Science budget remain protected and continue to grow to connect researchers with the scientific infrastructure of the UK.

[To what extent] science and research expenditure in Government departments (outside the Science Budget) complements or competes with the Science Budget?

  1. Just as the Government, the private sector and third sector have unique roles in the research environment, so do the diverse public funding streams of the Government Departments. Research into science and innovation through a cross-disciplinary approach is critical, but has suffered under significant reductions in Departmental R&D budgets. In the absence of more diverse funding streams, there must be long term, increasing investment through a ring-fenced Science budget to continue to provide stability to the research environment.
  2. The science budget can add significant value to the NHS by helping to upskill the workforce through better training and improved clinical knowledge. It also presents the opportunity for better care during research, as this tends to deliver more monitoring and additional resource. Successful research also provides solutions to the efficiency and innovation gains required to achieve the savings required by the NHS 5 year Forward View and beyond. We need to continue to increase investment in innovative research to realise sustainable, long-term savings in other parts of the system.

[What is the] need for and rationale for any adjustment to the trajectory of future Government expenditure on science and research, and what would be gained from an increase (or lost from a reduction) compared with current expenditure levels?

  1. Research is an unparalleled driver of economic growth and competitiveness, with significant additional societal benefit. Conversely, stagnant funding levels could be as damaging as cuts in real terms. The Government’s commitment to maintaining investment in the Science budget and other research funding streams must continue to grow in real terms order to support economic competitiveness. Innovation in areas such as health outcomes improve efficiency in other areas of government expenditure, supporting an investment strategy that is beneficial overall.
  2. For medical research, Government investment creates the foundation for an innovative, knowledge-based economy from which the third sector can drive forward cutting edge research strategies. Charities have the flexibility to invest in riskier, but potentially more impactful research, but these opportunities can only take place in a fertile research environment. Losses to Government expenditure in this area would reduce the number of researchers in the field and slow innovation, significantly delaying the economic and social benefits of research.

What level of Government expenditure on science and research is needed:

- to significantly drive the overall level of such expenditure in the economy, through synergies between government and private sector investment (including overseas investment)? And

  1. Dementia is a challenging disease area, costing more and being more difficult to understand and treat than many other conditions. Dementia costs the UK economy £26 billion per year, including £8.8 billion in publically funded health and social care costs[4]. Drug development costs on average £1 billion, in addition to a significant profit loss during the 10+ years of research between the initial stages and bringing it to market.[5] However, for dementia the cost of drug development is a staggering £3.6 billion[6], reflecting the unique challenges of studying degenerative brain diseases.
  2. The UK Government aspiration to identify a disease-modifying treatment by 2025 will require a significant increase in investment from all sectors. A steady increase in Government funding is required to meet this goal, but provides significant value for investment, attracting further private and charitable funding to the field. Alzheimer’s Research UK has called for incrementalannual increases to reach a total £132 million in Government spending for dementia research per year by 2020, a portion of which will be part of the Science budget.
  3. Government investment will not be the sole source of funding into this area, but its intervention is crucial to catalysing the “crowding in” effect of investment when every £1 spent by the Government on R&D increases private sector productivity by 20p every year[7]. The UK currently ranks fourth in the world for university-industry collaboration in R&D[8], demonstrating the overall effectiveness of the existing funding streams and the ability of UK research bodies to leverage support from Government into even greater collaborative opportunities.

- to optimally balance its benefits against the opportunity cost of government expenditure foregone on other public services?

  1. Research underpins our understanding of dementia, and affects all other areas of treatment and care. It is the foundation on which all stakeholders, from individual GPs to the NHS governance, make care decisions that impact people living with dementia. Investment through the Science budget drives a portion of the research that improves our understanding of dementia and progress toward a treatment, which will have a direct effect on the methods and costs associated with care for people with dementia.
  2. The Government is already bearing the significant cost of the lack of a disease-modifying treatment, estimated to be £4.3 billion annually to the NHS. It is in the interests of Government to prioritize the development of treatments to benefit people with dementia and relieve a portion of the costs to the public and to the economy as a result of the condition. Dementia has created opportunities for innovative funding models, encouraging strategic investment, but with the ageing population causing the costs of dementia to rise dramatically, continuing to grow the investment in research is required to bring about a treatment as quickly as possible. The Alzheimer’s Research UK analysis of the potential impact of several treatment scenarios found significant possible benefits against the costs of dementia. For example, if by 2020 a treatment was developed that could delay the onset of dementia by 5 years, there would be 36 per cent people with dementia by 2030 and the condition would cost £14.1 billion less in 2030 than without a treatment.[9]

[Are] the Government's expenditures on aspects of science and research… consistent with other government policies, including the Industrial Strategies and the Eight Great Technologies and fiscal incentive policies for research investment?

  1. Alzheimer’s Research UK fully supports the Government’s aspiration to develop a disease-modifying treatment by 2025, introduced in 2013 at the G8 Summit on Dementia and reaffirmed in the Prime Minister’s challenge on dementia 2020. To accomplish this, however, a steadily increasing amount of funding is needed to build the research field and support new innovations and discoveries. Funding through the Science budget for regenerative medicine, one of the Eight Great Technologies, has the potential to have some of its greatest impact on dementia.
  2. The Science budget, guided by the Haldane Principle, also has the benefit of supporting regional economies by promoting excellence in research, wherever it may exist. Alzheimer’s Research UK funds 700 scientists in 39 different universities and research institutions in our research network, allowing them to share resources and generate partnerships across disciplines. Cuts to funding could increase financial pressure on smaller research programs and reduce the geographic diversity of scientific research, including dementia research, in the UK.

[To what extent will] any increase or reduction in Government expenditure on science and research… have an impact on the UK's relative position among competitor states?

  1. Following a period of government cuts that drastically reduced available funding for research in the US[10], policy makers there are now considering increased spending in strategic areas[11] including significant increases in medical research spending and $300 million in additional funds specifically for Alzheimer’s disease[12]. Across Europe, decreased spending on science has caused concern for economic recovery in some countries. If current trends continue, China is on track to be the world’s top R&D spender by 2019[13]. Investment in scientific research is recognised as a key economic driver and opportunity for societal benefit, and has been prioritised in a number that have the potential to compete with the UK environment.
  2. However, investment in the UK from international research funders is robust: Over 50% of business R&D in the UK comes from firms headquartered overseas, higher than any other G7 country.[14] The UK remains well-positioned as a world leader, and an increase in funding would keep it competitive and benefit all areas of innovation, including dementia, whereas a reduction would have a detrimental impact.

[1]OECD Science, Technology and Industry Outlook 2014.

[2] The social impact of research conducted in Russell Group universities. 2012.

[3]CaSE submission to HM Treasury. 2015.

[4]Alzheimer's Society.2014. Dementia UK: Second edition.

[5]Tufts Center for the Study of Drug Development. 2014. Tufts CSDD 2014 Cost Study.

[6]New York Academy of Sciences. 2013. Economic Analysis of Opportunities to Accelerate Alzheimer’s Research and Development.

[7]Campaign for Science and Engineering. 2014. The Economic Significance of the UK Science Base.

[8] World Economic Forum. 2014. The Global Competitiveness Report .

[9] Alzheimer’s Research UK and the Office of Health Economics. 2014. Defeat Dementia.

[10]American Association for the Advancement of Science. Trends in non-defence R&D by function. 1953-2013.

[11]American Association for the Advancement of Science. Estimates of Congressional Action on FY 2016 R&D Budgets by Agency.

[12] Fiscal Year 2016 Budget of the U.S. Government.

[13]OECD Science, Technology and Industry Outlook 2014.

[14]Department for Business, Innovation & Skills. 2015. What is the relationship between public and private investment in science, research and innovation?