A macroeconomic assessment of the impact of medical research expenditure: A case study of NIHR Biomedical Research Centres.
Smith JBE., Channon KM., Kiparoglou V., Forbes JF., Gray AM.
Quantifying the value of investment in medical research can inform decision-making on the prioritisation of research programmes. Existing methodologies to estimate the rate of return of medical research are inappropriate for early-phase translational research due to censoring of health benefits and time lags. A strategy to improve the process of translational research for patient benefit has been initiated as part of the UK National Institute for Health Research (NIHR) investment in Biomedical Research Centres (BRCs) in England. By providing a platform for partnership between universities, NHS trusts and industry, successful BRCs should reduce time lags within translational research whilst also providing an impetus for local economic growth through industry collaboration. We present a novel contribution in the assessment of early-phase biomedical research by estimating the impact of the Oxford Biomedical Research Centre (OxBRC) on income and job creation following the initial NIHR investment. We adopt a macroeconomic assessment approach using Input-Output Analysis to estimate the value of medical research in terms of income and job creation during the early pathway towards translational biomedical research. Inter-industry linkages are assessed by building a model economy for the South East England region to estimate the return on investment of the OxBRC. The results from the input-output model estimate that the return on investment in biomedical research within the OxBRC is 46%. Each £1 invested in the OxBRC generates an additional £0.46 through income and job creation alone. Multiplicative employment effects following a marginal investment in the OxBRC of £98m during the period 2007-2017 result in an estimated additional 196 full time equivalent positions being created within the local economy on top of direct employment within OxBRC. Results from input-output analyses can be used to inform the prioritisation of biomedical research programmes when compared against national minimum thresholds of investment.