A new report from the University of Strathclyde’s Fraser of Allander Institute has outlined the strength of Scotland’s pharmaceutical industry and its value to the Scottish economy while measuring the growth of the sector since the last major review in 2017.

The report says the Scottish pharmaceutical industry exports £575 million worth of manufactured goods, up from £550 million in 2017, and supports £2.5 billion worth of industrial output every year.

The sector has a gross value added (GVA) of £1.8 billion, almost 6% higher than 2017.

The Association of the British Pharmaceutical Industry (ABPI) said recent investments by global pharmaceutical companies is helping to usher in a “new golden age of Scottish medical science.”

About 5,600 people in Scotland are directly employed by pharmaceutical companies with the majority of jobs in North Ayrshire, the Highlands and Dundee. This is a 9% increase on the 5,130 full time equivalent (FTE) employees reported in 2018.

The average annual salary for someone working in Scotland’s pharmaceutical industry is £35,600, significantly higher than Scotland’s annual median income of £24,486.

The ABPI said investment by pharmaceutical companies has a significant impact on the wider economy with every 10 jobs in the sector creating 17 elsewhere in the country. This figure means the sector indirectly supports 15,250 jobs.

“Scotland’s flourishing life sciences ecosystem also continues to be an attractive destination for cutting-edge research and development, with multi-million-pound investments by global pharmaceutical companies helping usher in a new golden age of Scottish medical science,” said the ABPI.

“Annual business spending on pharmaceutical R&D is now £165 million – up almost £45 million since 2012 – with projects on everything from genetic patient screening for rheumatoid arthritis, research into managing hypoglycaemia to reduce pressure on the Scottish Ambulance Service and better treatment of heart disease to reduce time people spend in hospital.”

Alison Culpan, Director of ABPI Scotland, said: “In a year that has seen our companies stepping up and starting to lead us out of the pandemic with the vital vaccines we need, I am proud that the pharmaceutical industry continues to thrive in Scotland.

“Scotland’s industry is stronger today than it was three years ago with more people employed in good jobs, more being spent on research and development, and exports topping half a billion pounds.

“It is important that the Scottish Government is ambitious and works with us to nurture and promote a sector which is not only exporting Scottish excellence around the world but delivering for the health of people here in Scotland.”

Deputy Director of the Fraser of Allander Institute, Mairi Spowage, said: “Our economic analysis shows that the industry continues to grow in Scotland with direct employment, exports and GVA increasing.

“The contribution of the sector extends beyond the activities of pharmaceutical companies themselves, with their output supporting employment and income right across the country including areas of historically high unemployment and deprivation.”

The report also reveals:

Pharmaceutical manufacturing is the second-largest spender on R&D after technical testing and analysis services, and supports 11,350 jobs alone throughout the economy

• Scotland’s life science sector boasts 3,000 people working in dedicated R&D roles
• GVA per head for the sector has risen by 38% to £158,550, versus £115,000 in 2017 – nearly three times the Scottish average
• Scotland’s pharmaceutical sector is also playing a role in the coronavirus pandemic.

Symbiosis, a specialist pharma services firm, helped manufactured the Oxford-AstraZeneca COVID-19 vaccine for clinical trials, and Livingston, West Lothian will be a major manufacturing site for the potential new vaccine being developed by Valneva.

Clinical research facilities across Scotland are helping to support clinical trials and research studies. Coupled with investment from pharmaceutical companies, Scotland continue to be an internationally recognised destination for innovative health research:

• Bristol-Myers Squibb has invested over £22 million in clinical research in Scotland in recent years including through a clinical study with the University of Glasgow to use genetic patient screening to help diagnose the estimated 60,000 people across Scotland that suffer from rheumatoid arthritis. With around 2,500 new patients every year, this is providing insights for future medical research.
• Pharmaceutical company MSD has been working with NHS Fife to reduce the number of ambulance callouts for patients experiencing a hypoglycaemic event by 38% thanks to better follow-ups with patients, helping free up Scottish Ambulance Service capacity in the Fife area.
• Novartis has helped develop and fund a Myeloproliferative Neoplasm (MPN) Clinical Nurse Specialist service with NHS Lothian to provide expert care and treatment. The nurse-led service includes telephone and outpatient clinics, helping to address capacity issues by offering 800 appointment slots every year.