SIR DAVID COOKSEY

24 JANUARY 2007

  Q1 Chairman: We very much welcome Sir David Cooksey to the Science and Technology Select Committee this morning. May I start, Sir David, by saying that the Committee not only welcomes but compliments you on an excellent report, in terms of the work that you have done in looking at the whole of the medical research, both in terms of the basic research and the translational research. We, as a Committee, are very grateful to you for that work. I wanted to put that on record, before we start finding fault!

  Sir David Cooksey: I am very grateful to you for that positive start.

  Q2 Chairman: You are certainly very welcome. Could I start by saying that the final report went far beyond the initial terms of reference. Why did you feel that it was necessary to go on to design institutional arrangements for the public funding of health research in the UK? You seemed to go beyond what was the original remit.

  Sir David Cooksey: I think that I would dispute that. I agree with you, I went beyond the original remit; but if you look at the terms of reference that I was given, it did ask me to connect our public expenditure on health research with the health of the research community on the one hand, with the delivery of economic healthcare on another, and with the economic impact on industry as well. It therefore broadly stretched across that horizon. I probably overstepped the mark in the work we did on the development of a new drug development pathway, but that was given a very strong welcome by all concerned. So I do not think it was untoward to be doing that.

  Q3  Chairman: We will return to that particular issue a little later. I think the term "everybody welcomed" it is perhaps an overstatement, but we will certainly come back to that. In terms of MRC, what discussions did you have with MRC about the impact of your proposals?

  Sir David Cooksey: Throughout the development of our ideas and proposals we were in touch with the MRC, probably at least once every other week, and the ideas were well ventilated to the MRC before they were published.

  Q4  Chairman: There is still a real concern—perhaps you would accept, perhaps you would not—by MRC, and people who are particularly interested in retaining the excellence of basic research, that perhaps that has been compromised by your proposals. How would you respond to that?

  Sir David Cooksey: The basic science community are very, very successful at defending their patch, and they were bound to respond like that. I have made it very clear in the report that their current level of funding should be sustained. I have also made it clear that I value greatly the excellence of the research base. However, one of the things that we have done is to try and look at strategic priorities for health and to try to relate that back through to the funding stream.

  Q5  Chairman: If you look at the whole of health research as a continuum rather than two separate pots—and I think that is the tenor of your report, is it not?

  Sir David Cooksey: Yes.

  Q6  Chairman: That we should not look at it as separate activities but as one activity which leads backwards and forwards into each area. Do you not see that there is a real danger that in fact the translational research element of it, the clinical research element of it, may well swing, if you like, into MRC's traditional area, and therefore lessen the impact of our basic research in terms of medical health?

  Sir David Cooksey: I think I disagree with you fundamentally on that. What we concluded was that there was excellent basic research done. It was virtually all investigator-led, so that the focus of the research was not necessarily on the areas that were most in need of being resolved; but that is the nature of the way we arrange our science funding in this country. One of the real problems we saw, however, was this hiatus between the basic research community and what they were achieving and the lack of drawing that through for patient and economic benefit. A lot of the basic research discoveries that we make that should find their way into patient benefit do not necessarily do so. This was a flaw in the system which was identified time and time again in our consultation process.

  Q7  Chairman: You also identified that there was a real concern not only about the way in which money was being spent within NHS research, or not spent in terms of research—used for bolstering up other activities, and that is not a criticism but just a statement of fact—but also one of your concerns was the excellence of translational research or clinical research, and yet you do not appear to be making any recommendation in the report. For instance, that the methodology of peer review, which is at the heart of basic research through MRC, should be extended into other areas through the single fund. How do you get excellence?

  Sir David Cooksey: I am sorry, I cannot put my finger on the exact paragraph at this moment in time, but what we do say in the report is that peer review should be applied throughout the research process but that a different approach to peer review should take place in clinical and applied research, rather than the very basic process that is applied to basic research. Here, the issue is that, in basic research, you can understand the quality of the research proposal and the peer review process gives you a binary gate which says yes or no as to whether or not you proceed. Then the funding board of the MRC will choose what they consider to be the best proposals that have got to go through that gate—since not all of them get funded. However, when you get to the clinical development of a basic research discovery, you have a situation where the process becomes much more iterative and you want to design a clinical development programme and clinical trials; but very often you have to go back and redesign those as you learn during the process. The current manner in which peer review is applied in the basic research process would create a situation where, unless you could see your way through the entire clinical development programme on day one, it would be very difficult to get peer review acceptance of that proposal. What we have proposed in the report, therefore, is a more iterative approach: that a different application of peer review should take place. However, it is absolutely agreed between ourselves and Sally Davies and her team at the NHS R&D function that peer review should apply to all clinical research that is funded.

  Q8  Chairman: I think it is important to put that on the record. In terms of your definition of `medicine' which you used in the report—in fact this has been a fairly widespread criticism and you have also mentioned it earlier—it seems to refer mainly to pharmaceuticals and not, for instance, to preventative medicine or health technologies. Why do they get so much less attention in the report than pharmaceuticals? And is that a fair criticism?

  Sir David Cooksey: It is a fair criticism. It is not just pharmaceuticals. I would take my criticism a bit further since there is insufficient reference to diagnostics and to medical devices as well as to the other therapies—which gets into the point that you are making about preventative medicine. Without having a rather laborious re-statement of all of the issues time and time again, I am afraid we used `pharmaceuticals' as a bit of a shorthand for the whole thing. There are sections in the report, however, which deal with HTA, with preventative medicine, and so on. I totally agree with you: that it is very important. What we were asked to do was to ensure that, in putting the new structure in place, we put in place what was likely to have as much economic benefit as patient benefit and social benefit. It is easiest to crystallise one's proposals in terms of the pharmaceutical industry, and that is why that was done.

  Q9  Chairman: It is just that, when you look at the health economy and you look at roughly £8 billion which is spent on drugs within the Health Service and then you look at how much is spent in terms of technologies to support patient care, it is a tiny fraction of the drugs bill. We understand the reason for that, but I think many would argue that there is a need to give greater emphasis to the huge technological changes that are occurring which can improve healthcare.

  Sir David Cooksey: Yes, and there is a section in the report about that which explains how we have actually denied ourselves a strong medical devices industry in this country, because we have been very bad at using the purchasing power of the Health Service to succour that type of industry.

  Q10  Chairman: It was fairly obvious, when the Chancellor made the original statement in terms of announcing the review that you conducted, that there were two lumps of money which initially added up to about £1.3 billion. When the Chancellor said "around £1 billion"—and in fact we have had the former secretary of state, Alan Johnson, in front of us who again reiterated that it would be around £1 billion, and that is what has come out of your report—what has happened to the missing £0.3 billion? Is that not a cut in the overall funding?

  Sir David Cooksey: I think the reason why the Chancellor mentioned £1 billion was because he did not want to constrain us to taking forward inside the ring fence everything that was there at the moment. In fact, if you read the report carefully, we did recommend that everything that was in the ring fence—be it in the OSI ring fence of MRC or the NHS R&D budget ring fence—was included. So the £1.35 billion is there and, on top of that, we recommended a number of issues, such as that the funding of clinical fellowships and clinical training budgets, should be taken inside the ring fence. That is therefore an increase over what was there previously. It is a very modest increase but it is an increase.

  Q11  Mr Newmark: It is not an increase, because you are just shifting something from outside the ring fence to inside the ring fence.

  Sir David Cooksey: We were talking about why £1 billion rather than £1.35 billion. What I am trying to say is that the £1.35 billion is intact as far as I am concerned, plus a little more, which is an area which, rather like the NHS R&D budget, has been historically raided. There is no way, if you want to build up a good clinical research capacity in this country, that you use it as a pot of money to raid. That is the reason why we have suggested bringing the MPET budget inside the ring fence.

  Q12  Dr Turner: Could I ask you to comment on this? The cynic in me tells me that a lot of what was identified in the past as NHS R&D budget was, shall we say, not spent as effectively on research as it might have been and has gone to other NHS-related purposes. Can you comment on the effectiveness and the spending of the existing NHS R&D budget? Do they actually fund up? How much of it is funding what we would recognise as research or supporting research fellows, which is a perfectly reasonable thing to do? Does the figure that you envisage actually embrace all the genuine research-related activity and effective research activities currently being practised under the heading of the NHS R&D budget?

  Sir David Cooksey: If we go back to the report I did three years ago, called Biosciences 2015, which was the Biosciences Innovation and Growth Team report, it identified that, at best, only £70 million of the NHS R&D budget was spent on pure R&D. It all flowed through the trusts. The result of this was that some trusts claimed that that budget was being spent on providing infrastructure to support R&D, and others just raided that budget for frontline services. I agree with you entirely. I think that the Chancellor became very frustrated with this situation because he had tried to put more resources into this area, and this is the reason why he ring-fenced the budget. If you look at what has actually happened since April of last year and if you were to have Sally Davies, the NHS R&D Director, alongside me, she would say to you that the ring fence has been extremely effective; that, at long last, they are able to plan R&D on a coherent basis. I would need to confirm these numbers, but I think that in year one, which is the current financial year that we are in, 50% of it was moved to the centre and the R&D is then being funded outwards from the centre. That increases to 90% next year and to 100% the year after. I think that ring fence will be very effective. It was one of the reasons why we required in the report that the NIHR moved from being a virtual agency to being a real agency; that is because you can then get a separate vote on that funding and ensure that that money stays inside the ring fence.

  Q13  Dr Turner: It would be a mistake to focus too much on the £1.3 billion headline figure, because it is not a true expression of reality.

  Sir David Cooksey: I agree with that. If I could take that a little further, there was a huge temptation for me to make a very strong case, as I could do, for increased funding for this area; but, with the NHS budget being so out of balance at this moment in time, it was clear that I was not going to get an immediate response from the Chancellor on that. What we agreed was that we should concentrate on the forthcoming Spending Review, to try and ensure an increase in the budgetary provision for this area. I think that the Treasury is reasonably sympathetic to that, as long as we put a good case together. The evidence in the report from what has happened with the Canadian Institute for Health Research and, on a much grander scale, the NIH in the United States, shows very clearly that if you want to achieve the sorts of changes we are talking about you do need to lubricate that process with more money.

  Q14  Dr Harris: On the question of peer review, there is barely a page in your report on peer review, yet you make what is quite a substantial critique there and it is hard for people reading it to see the evidence of your research—in prestigious journals, and so forth. Would you accept that there is more work required on peer review, both by the Research Councils and possibly by other people—arguably this Committee might do something—before any recommendations are implemented with regard to peer review, because it is such a sensitive matter?

  Sir David Cooksey: I think it is a system that is working reasonably well at this moment in time. What I was describing earlier was a situation where it needs to be adapted for various stages in the research continuum. However, I understand that RCUK at the moment is undertaking a review of the whole peer review process. We trailed that in the report, and I think it is worth waiting for that to come out, and then I think it is a subject that should be debated.

  Q15  Dr Harris: I will come on, after Mr Newmark on the new institutional arrangements, to explain the sensitivities of people in research who feel they have to respond to a top-down diktat on research subjects. However, I just wanted to pick up one other thing which the Chairman mentioned. It is this issue about your not necessarily narrow definition of restricting it to pharmaceuticals in healthcare interventions. You said that you used it as an example, and your own background is as an investor in biotech and, arguably, early stages of drug development. Would it be fair to say that that was an influence on your choosing pharmaceuticals as the main example of where you wanted to speed up the ability of investors to see fruition, as well as patients seeing the benefits of research?

  Sir David Cooksey: We have invested in a considerable number of devices companies and other areas, including companies offering innovative procedures and so on. So it is not just pharmaceuticals as far as my own business is concerned.

  Q16  Dr Harris: I accept that. Would you say that at least some people might say, "Well, he would say that because his interest is in speeding up and reducing the costs of developing something that becomes profitable"—as is your right. Therefore, in a sense you have, not necessarily a conflict of interest but maybe a bias in saying, "The key thing is to speed these things up, and if we skimp on safety trials and regulation a little bit, then that's all right because the key aim is to give a return on investment sooner".

  Sir David Cooksey: I object very strongly to you using the word `skimp', because that is not what the report says.

  Q17  Dr Harris: The term . . . ?

  Sir David Cooksey: You said "skimp on trials". Perhaps we will come back to this later, when we discuss the new drug development pathway plan. I will leave it there. We were asked under the terms of reference to look at the economic impact of all of this, as well as the effect on the research community and on patient health. The situation is that healthcare and its delivery is a sure-fire growth industry (if you like to call it an industry) which is going to grow progressively year after year from now onwards, as it has done in the past. If you look at the numbers, it is quite shocking. That a business that is increasing in size, productivity, in both the delivery of healthcare and in the healthcare industries, particularly the pharmaceutical industry, has gone backwards year by year for the last 15 years. With the increasing public expenditure in healthcare and decreasing productivity, if you continue this trend out into the future it shows that—depending in which country you are, it will take longer or shorter—40 or 50 years, for the entire GDP of this country will be spent on healthcare. That is totally unsustainable, because who is going to pay for it? Therefore, we did feel that it was incumbent on us to look at ways in which there could be a step change in productivity, using new methodologies to achieve better and more productive outcomes. That is why we call for the adoption of the facilities available, or that can be made available, from Connecting for Health to make a huge difference to the way in which you can approach trials. We concentrated quite a lot of the report on the HTA exercise, in order to try and look at methodologies needed to help reverse that downward spiral of productivity over the years.

  Q18  Mr Newmark: There is a new tier of administration being created called OSCHR. The purpose of this, I understand, is to help the administration of research funding. First, how will the joint line of reporting to the Department of Health and the DTI from a single body actually work in practice?

  Sir David Cooksey: The concept of OSCHR is that it is a very light-touch organisation. It will have a small board overseeing it, and we have been fortunate in getting John Bell as the interim chair of that board. It will use people drawn from the Department of Health and OSI to develop the strategic requirements of the Government in health research in this country. We can set the strategy, but that is a joint effort by these people coming in from both sides of the equation, with both the chairmen and the chief executives of the MRC and NIHR sitting on the board of OSCHR. Its role is to set the strategy, to work with MRC and NIHR to develop a single Spending Review bid for the whole of medical research. The Spending Review bid therefore comes out of OSI and DTI and goes directly to the Treasury from OSCHR. Then the funding streams come back down, through the Secretaries of State for Health and the DTI and through the two accounting officers, who are Sir Keith O'Nions in OSI and Sally Davies in the Department of Health, in order to make sure that you have the same accountability. We felt this was very important, because if you look, for instance, at the way in which successful clinical research is developing at the moment—and basic research for that matter—it involves more and more of the use of interdisciplinary teams working in this area. We wish to maintain the strong relationship of MRC with RCUK and the other Research Councils, so that we can maintain that interdisciplinary working.

  Q19  Mr Newmark: If I cut through things, you talked about productivity and what flows from that is value for money. How will creating another tier deal with the issue that you have highlighted, which is the problem of productivity from the Treasury standpoint on assuming value for money? I guess the third thing is—when I think about another tier of bureaucracy, as I would call it, though I can see the argument you have put forward—how does it prevent delays in administering research proposals? Because you have another tier thrown in there, in the process.

  Sir David Cooksey: It will not make any difference to that at all.