Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 80-99)



  80. We talked about poaching, do you find have you human capital coming in from the private sector, like Glaxo?
  (Professor Goodfellow) Yes, we do.

  81. Do you have examples of people coming in from these companies taking less money than they were in the private sector?
  (Professor Goodfellow) I do not know enough details about their salaries.

  82. Do you think there is a danger of them coming in and trying to distort priorities?
  (Professor Goodfellow) There are a very wide range of people that work in public sector bodies. I could not imagine one person coming to an institute with 800 people and distorting it.

  Chairman: We are going to have a break for 10 minutes.

  The Committee suspended from 17.49 to 17.57 for a Division in the House

Geraint Davies

  83. Can I ask, is there any experience of the private sector paying for lots of lunches and days out to the public sector? I do not know if anybody has any experience of that or not?
  (Mr Young) Have we been recipients of this generosity.

  84. Yes?
  (Mr Young) Speaking for myself, no.

  85. Can I ask you something completely different. In terms of some of the partnerships, maybe I can ask Professor Radda this, if there is a relationship with a private sector partner who is interested in developing a drug, a kidney drug or whatever it is, is there a danger that that private sector partner will want to, as it were, delay overall access in knowledge that we have for competitive advantage and profiteering against the public interest, do you find that is a problem?
  (Professor Sir George Radda) Perhaps I can answer that in a more general way. If you look at page 5 of the NAO Report is actually sets down correctly what our priorities are in our commercialisation activities. The first and the most important priority is to able to make sure that the commercial arrangements are such that they provide the benefit, if you like, the welfare benefit to the public. That is our number one priority.

  86. I appreciate that. If I was in the private sector and I said to you, I want to develop this drug, it helps various people but I want to have rights to use it through my company alone, or whatever, for the first few years to get my return?
  (Professor Sir George Radda) That is clearly part of the negotiations of what is the best value and what is in the interest of the public. For example, there is a danger that a company would take on a licence or an IPR in order to stop producing that drug because they already have a product that is competitive, we would clearly try and not agree to such a process. We would want to have, if you like, that for the public benefit.

  87. You are interested in the public benefit. In terms of the overall distribution of costs is there a danger here that the public sector take all of the fixed costs and then the marginal costs are paid for by the private sector and then the overall profitability, the great share is taken by the private sector and we are taken to the cleaner, to a certain extent?
  (Professor Sir George Radda) We have to rely on the experts that we employ in negotiating those deals. We have examples where we have been offered £4 million up front to buy-out prospective product royalties—I cannot repeat the company's name because it is commercially sensitive—for a vaccine against a respiratory virus and we said that is not good enough value, our people said that is not good enough, and we turned it down. We have now made more than £14 million from income otherwise.

  88. You take a fixed cost but you take a share of profit over time?
  (Professor Sir George Radda) It is very common.

  89. In so far as you are motivated by maximising the financial return then the response of that from the private sector is to try and restrict the opportunities for competitive entry into that market to make money. There is a conflict between you maximising your income and the public interest and having widespread access to the drug we have just been talking about.
  (Professor Sir George Radda) Maximising our income will not be our highest priority, our highest priority is to make sure that the product will be available for the public for a particular health treatment, that would be our number one priority. Maximising our income is the lowest of the priorities we have set down, as it is recognised in the NAO Report.

  90. This company you were deal with £14 million, or whatever it was, and they turned round to you and said, we will give you £7 million and make it easier to get access, you would say, fair enough because my priority is not really about making money.
  (Professor Sir George Radda) If you take an equity stake in a deal with a company, and both the scientists will have produced that, and also, if you like, you have a much better handle on how that is being exploited.

  91. You mentioned earlier your ethical considerations are paramount and you would not deal with a cigarette manufacturer, if a cigarette manufacturer said to you they wanted you to work with them to produce healthier cigarettes would that not be in the public interest?
  (Professor Sir George Radda) We have not been asked that question and it is hypothetical. I suspect our council will consider it extremely carefully. I am pretty sure that the council would look at it and decide what is in the public interest.

  92. Very good answer. I have a general question about the cultural shift, obviously now the total income is a small share, 17.5 in broad terms. As that shifts is there a danger the scientific culture may shift away from the public good towards always looking for the next buck?
  (Professor Sir George Radda) I hope not. If you like, the code of conduct which we have for scientists pretty clearly spells out where we have to have controls over that. What is important is the scientists themselves have recognised they could help the public by commercialising their activities. That is, I think, again the priority that we try to put on to our scientists.

  93. Can I pursue another point you made about academics and the global market place, do you feel it is the case when you look at the number of academics being attracted to British universities there is a much higher propensity for those people to come from abroad simply because home grown people do not feel they are being paid enough? A lot of those people are not coming from the United States at all, they are coming from Greece, or wherever it is, or the developing world. What we are in the business of doing now, inadvertently, of paying low wages, is asset stripping the developing world of academics and not attracting United States people. There is a big problem here.
  (Professor Sir George Radda) I do not have the figures of how many academics are taken from developing countries. There is no doubt that in the United States a large number of the post-doctorate fellows and students come from China and India, I do not think that is the case in this country.

  94. In terms of the balance of trade between us and the United States on academics, would I be right to say there is a massive imbalance and basically they are taking our people and we can recover a few of them, but we really do not have the financial punch to do that or is there a difference in what you do, as it were, and the university sector generally? I do not know whether Professor Goodfellow is in a position do answer this, having just come out of the university sector.
  (Professor Goodfellow) There is a range of salaries people pay in the university sector. As we already said, Gareth Roberts is doing a report which we are waiting for, a report for Treasury, it is due out in April and we are all waiting to see what he is suggesting about the salary, the career structure for scientists and how many scientists and engineers we need in the United Kingdom. We are all waiting for that.

  95. Professor Radda, on the medical side, in terms of the market needs, if the money is in cosmetic surgery rather than a low income return in terms of vaccines that will save lots of people's lives do you find there is this increasing pressure from the private sector towards profitable areas rather than public interest areas?
  (Professor Sir George Radda) The market drives our research very little. Our research very often drives the products that are produced as a result from the research that we support. Most of our commercialisation activities actually have been driven by the science rather than the other way round.

  Geraint Davies: It is push rather than pull!

Mr Gibb

  96. On page 2 of the Report, paragraph 2 it says that one of the core roles is to train the next generation of research scientists. During this hearing you have heard phrases like, non-United Kingdom scientists, foreign PhD students, in many cases many of these people have been brought in from abroad, we have a deficit of people. I just wonder, it is not often we have three senior professors before us, starting with Professor Radda, whether you have any views of the British state education system?
  (Professor Sir George Radda) In postgraduate, and we can talk about education afterwards, our own training budget in the last 10 years has increased by more than a factor of two. We now spend £40 million per annum on training and that is a very important component of our activities. If you are asking about the education system right down from schools up to there I can only express my private view—the MRC, as such, has no view on that—we do need to make sure that we can get more people into the sciences at the primary level of education and the secondary schools. Yes, that is a problem. We can advise and we can try and work with other people whose responsibility it is to see to that. It is, of course, not an MRC responsibility as such, we start with graduate education or postgraduate education onwards.
  (Professor Goodfellow) We put about £24 million into training of Phd students in the United Kingdom. Our own studentships go to United Kingdom nationals. It is very difficult to get people from abroad on those studentships, so we are training United Kingdom people on them, and that is just over 2,000, and at least 700 of them are joint with industry as well, so they get some time in industry during that period as well. We are very keen to see greater numbers of people coming through the university sector. As my colleague has said, it is not part of our remit in BBSRC to affect the university sector, obviously we go in and we encourage both men and women to go into science.

  97. I just wonder, Professor, whether coming recently out of university whether you have any views about the British education system at the secondary level?
  (Professor Goodfellow) At the secondary level?

  98. In helping you do your job, one of the core tasks of which is to train and educate the next generation of research scientists. Do you have any views, personal or otherwise about the British education system over the last 20 years?


  99. Not too long.
  (Professor Goodfellow) I was going to say I have anecdotal evidence as I have two children, one of which is just doing her GCSEs but I do not think that is relevant to this Committee.

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