A shift in sustainable development: Understanding biodiversity net gain, hydrology, ecology, and landscape
by Helena Preston
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Delivering Net-Zero healthcare
- Post Date
- 18 September 2024
- Read Time
- 7 minutes
Is an electric car better than a petrol one? Does a meat substitute really help the environment? What’s my fridge’s annual electricity consumption – and bill?
We increasingly think about sustainability at the product level. This allows consumers and customers to 'vote with their wallets' and make informed decisions about the goods and services they buy. Consumers are willing to pay a 10% premium for a more sustainable product according to PwC’s 2024 global Voice of the Consumer Survey [1]. Just under half of consumers surveyed said they buy more sustainable products to reduce their environmental impact. Of course, there is often an intention-action gap when it comes to consumption habits, but it indicates that product sustainability is at least on consumers’ minds. A recent joint study by McKinsey and NielsenIQ of the US market found that growth in products with Environmental, Social or Governance (ESG) related claims outpaced growth in products with no claims, and brands with higher sales from products making ESG-related claims enjoyed greater consumer loyalty [2].
This shift to product-level thinking also suggests that the question of enterprise sustainability is now ‘business as usual’. Focus has shifted outside the traditional corporate gates to the wider value chain and how products and services are delivered.
Requests for product-specific sustainability information are on the rise. These requests can come from customers or consumers, investors, and regulators. The pharmaceutical sector is no exception. A growing and ageing world population, together with impacts from a rapidly changing climate, has come hand in hand with a parallel surge in demand for pharmaceutical products and healthcare interventions. Simultaneously, the pharmaceutical industry is increasingly expected by both regulators and buyers to deliver and guarantee access to high-quality medicine, while reducing the environmental impacts associated with the production, distribution, use and end-of-life of pharmaceuticals.
In the UK, the National Health Service (NHS) has led the push for product-level environmental information and is committed to deliver a Net-Zero health service. As part of its Net-Zero supplier roadmap, new requirements overseeing the provision of carbon footprinting for individual products supplied to the NHS will be introduced from April 2028.
Not all product-level environmental claims are created equal
Lifecycle Assessment (LCA) is the process of evaluating the environmental impacts of a product throughout its entire lifecycle, from the production of the raw materials that are needed to make the product, through to the product’s manufacture, distribution, use, and end-of-life ('cradle-to-grave'). LCA covers all relevant environmental impact categories – from climate change to acidification, and from resource use to human- and ecotoxicity. Because of this broad scope, LCA is a good way to support robust product-level environmental claims.
Herein lies a problem. While there are international rules for how LCA is conducted in general – set out in the International Organization for Standardisation (ISO) 14040 and 14044 standards – these allow a high degree of methodological flexibility and apply generally to all sectors of industry. This means that companies can make decisions around what is included (and perhaps more importantly, excluded), how they define the functional unit (the unit through which LCA results are normalised and communicated, e.g., treatment of one patient for disease X for one year), and what data they use to estimate the environmental loads and impacts across the product’s lifecycle.
This flexibility has led to inconsistency in how LCA has been conducted in the pharmaceutical sector so far. Because of this, combined with a perceived risk of being criticised for greenwashing pharmaceutical companies have by and large kept those LCAs private.
This all started to change in 2020, when His Majesty King Charles III – then Prince of Wales – launched the Sustainable Markets Initiative (SMI) [3] at the World Economic Forum’s annual meeting in Davos. The SMI aims to convene industry, financial services and governments to innovate, accelerate and deliver on a just, sustainable and prosperous future. It does this through industry taskforces, of which the Health Systems Taskforce is one. This Taskforce aims to take joint, scalable action to accelerate the delivery of Net Zero healthcare – to improve individual, societal, and planetary health – and to collectively address emission hotspots across supply chains, patient care pathways, and clinical trials. The SMI Health Systems Taskforce committed – amongst other things – to “align on a common framework to perform LCAs, with private sector members also committed to publishing product-level LCA data”.
The Pharmaceutical LCA Consortium launched in November 2023
In response to this commitment, a group of companies came together under the banner of the Pharmaceutical Environment Group (PEG) [4] – which is an SLR project. A formal Consortium ('the PharmaLCA Consortium') launched in November 2023, and now consists of AstraZeneca, GSK, Johnson&Johnson, Novartis, Novo Nordisk, Pfizer, Roche, Sanofi, and Takeda. The PharmaLCA Consortium plans to undertake at least four interconnected Work Packages (WPs) between June 2023 and November 2025:
- WP1: Technical development of rules for applying LCA in pharma.
- WP2: Data improvements to enable more accurate LCA for pharmaceutical products.
- WP3: Technology development of a tool for the sector to use.
- WP4: Stakeholder engagement to ensure the new rules are widely adopted.
If we think about LCA like cooking, WP1 is creating the recipe. WP2 is about ensuring we have the right ingredients. WP3 represents our cooking equipment. WP4 represents the diners in our restaurant – even if we have a brilliant recipe, the finest ingredients, and the best kitchen equipment; if no one comes through the door, it has all been in vain.
In addition, the Consortium is developing an associated Publicly Available Specification (PAS) standard, by the British Standards Institute (BSI), co-sponsored with NHS England and the UK Office for Life Sciences (OLS).
This is truly a transformative project
PharmaLCA Consortium’s work will improve and streamline pharmaceutical LCA, making it quicker, easier and less resource (time/cost) intensive to calculate product-level environmental footprints. It will reduce complexity, make information more useable to stakeholders, and give pharmaceutical companies robust data on where the key impacts of their products lie.
With high-quality, comparable information, stakeholders like the NHS can make informed choices about product development and patient care, and pharma companies can change product design and manufacturing processes to reduce impact – particularly for new medicines that are still in development.
At SLR, we feel privileged to be supporting the PharmaLCA Consortium as its project management entity and look forward to seeing the fruits of its work benefit the sector, patients, and the planet.
For more information visit Pharmaceutical LCA Consortium.
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References
[1] https://www.pwc.com/gx/en/news-room/press-releases/2024/pwc-2024-voice-of-consumer-survey.html
