It’s a well-known fact that new product approvals in the pharma industry have been in decline in recent years. In 2010, for instance, the FDA only approved 21 new drugs compared with 26 and 24 in 2009 and 2008, respectively. July 2011, however, saw the FDA approve its twenty-first product for 2011 with AstraZeneca’s blood-thinner Brilinta, so it seems as if the agency is set to outpace 2010’s dreary approval numbers.

So does this represent the end of pharma’s innovation slump? According to a statement issued by financial services firm Burrill & Company, which is based in San Francisco (US), it’s a promising development, but there are still issues that need to be addressed.

“We’re on our way to breaking the anaemic pace of new drug approvals of recent years, but the problems underlying the relatively low rate of approvals since 2004 still need to be addressed,” said G. Steven Burrill, CEO of Burrill & Company.

Burrill explained that the FDA has a role to play in reversing the decline and that the agency must find a way to ensure the safety of new drugs without slowing the introduction of new therapies. Unfortunately, that’s a tough balance to strike. Many in the pharma industry believe there is too much red tape strangling innovation, but this tape is necessary to protect patients.

Low-drug approval rates are not just a problem in the US. In Europe, the EMA has seen a reduction in the number of overall approvals, including approvals for new products, according to figures published on the agency’s website. In 2010, the EMA issued only 51 positive opinions for marketing authorisation applications compared with 117 in 2009. Overall, the EMA only finalised 54 marketing authorisation applications, compared with 125 in 2009.

As with the FDA, however, it seems that 2011 may be a better year for the EMA. As of June 2011, the EMA has issued 38 positive opinions and finalised 42 marketing authorisation applications.

Of course, just because 2011 seems to be shaping up better than 2010 doesn’t mean we’re out of the woods yet. Burrill said: “Seven months of data is not enough to suggest a significant change at the FDA or that strategies to alter the drug development process to improve productivity are paying off. It is encouraging. But improving the pace at which new drugs reach the public will require much more work, both at the agency and in industry.”

According to Burrill & Company, the performance of the life sciences industry in 2011 is shaping up to be strong, although the debt issues in Europe and the US could disrupt the industry.

“The continuing battle over healthcare reform creates uncertainty. That hurts the industry,” said Burrill. “At a time when lawmakers should consider ways to stimulate investment in the industry and foster job growth, Congress should be careful not to erect new obstacles.”