The Value Pharma Places on Circular Economy
‘’A circular economy responds to the main challenges of our time. It will help our economy to become more competitive and resilient, relieve the pressure on our resources and the environment. It is about transforming the market economy in a more sustainable direction. It is about changing mind-sets and business models. It is about promoting competitiveness, growth and job creation’’.
– Jyrki Katainen, Vice-President of the Commission, responsible for Jobs, Growth, Investment and Competitiveness [1]
So why is a circular economy important to EFPIA? The driving motivation of the pharmaceutical industry is to improve human health and well-being. With nearly a quarter of global deaths attributable to the environment (UNEP, 2016. Healthy Environment, Healthy People), we recognise that reducing our environmental footprint is an important step we can take to positively impact human health. A shift to a circular economy could bring many health benefits. For example, optimising materials and processes to reduce our carbon footprint will help to combat climate change – described as the greatest opportunity to advance human health in the 21st Century.
Furthermore, a circular economy is a key policy pursued by the European Commission. It is therefore vital that our trade association is perceived as a credible and key partner when EU institutions seek to establish a dialogue with industry. EFPIA supports the principles underpinning the circular economy, and looks forward to receiving more clarity on the European Commission’s forthcoming legislative proposals. If well designed and part of a coherent policy approach, they would benefit the economy and environment, assisting a resource-efficient, competitive and resilient pharmaceutical industry to continue to deliver innovative medicines to improve healthcare. Any decision for regulatory changes must, though, be evidence-based and consider full product lifecycles to avoid unintended consequences.
Circular economy could help to harness our innovation expertise, driving the efficient use of materials, and improving long-term business value. By engaging on this issue now, we can help to shape future policy decisions to maximise opportunities for the healthcare sector.
EFPIA has already issued a White Paper on “Circular Economy’’, focusing on its importance for the pharmaceutical industry as well as on the measures needed to move towards increased sustainability. Our members work constantly towards cost-effective and resource-efficient innovations (for example Process Mass Intensity (PMI) and Green Chemistry). A shift to a circular economy will expand innovations already taking place across the industry.
A case in point is AstraZeneca’s solvent recovery. The Avlon site near Bristol in the UK is the manufacturing home of the active pharmaceutical ingredients (APIs) for two key AZ medicines. In 2012, AZ invested £4.7 million in a major new facility for the recovery of solvents, a hazardous waste stream in the production process of APIs.
Three years on, AZ is reaping the benefits. The recovery unit processed 480,000 litres of solvent waste in 2015, and generated savings of £437,000. This contributed to a 3.4% reduction in AZ’s total hazardous waste generation, and, for the drug in question, a 4.5% reduction in production costs, by avoiding 85% of previous virgin solvent use. It also reduced significantly road haulage for the transport of virgin and waste solvents, and generated significant CO2 benefits. Savings are projected to increase to £695,000 in 2016, with payback of the original capital investment expected after seven years.
Another example is Johnson & Johnson’s active involvement in health promotion and disease prevention. Healthy lifestyles and the prevention of disease through lifestyle changes hold great promise for improving health. J&J supports many efforts to promote health and wellness and reduce preventable diseases, encouraging healthy lifestyles among its employees by introducing company-wide incentives.
The programme includes: health assessment and counselling to help employees understand and reduce their health risks; opportunities through company-sponsored initiatives for employees to be physically active; and preventive screenings under the Healthy People Medical Plan.
J&J also works with others to help reduce the rate of chronic disease through such programs as:
- the Partnership to Fight Chronic Disease;
- the Campaign to End Obesity;
- the CEO Cancer Gold Standard;
- America On the Move;
- the creation of the J&J Diabetes Institute;
- numerous global giving programmes that support community-based initiatives to prevent and reduce the impact of chronic diseases and HIV/AIDS infections; and
- engagement with the Oxford Health Alliance
Our final portrait is that of “Kalundborg Symbiosis” by Novo Nordisk, which is an industrial ecosystem, in which the by-product residual product of one enterprise is used as a resource by another enterprise, in a closed cycle. An industrial symbiosis is a local collaboration through which public and private enterprises buy and sell residual products, resulting in mutual economic and environmental benefits.
The participants in the industrial symbiosis exchange energy and materials and have realized that a carefully managed cooperation can enable mutual economic benefit and reduce the environmental impact of large industrial operations.
Kalundborg’s Industrial Symbiosis comprises eight core companies: Novo Nordisk (manufacturer of pharmaceuticals), Novozymes (manufacturer of enzymes), DONG Energy (Power Station), Statoil-Hydro (refinery), Gyproc, Saint Gobain (manufacturer of gyp boards), RGS 90 (recycling company), Kara Noveren (waste company) and Kalundborg Municipality. Each company is bound to each other via an intricate network of flows: flows of steam, gas, water, gypsum, fly ash and sludge.
These are just a few examples that serve to highlight the importance that we as an industry place on the concept of a circular economy. We are committed to playing our part in developing a more resilient, competitive and environmentally-friendly economy that will benefit every European citizen.
