A research head of one of the world's biggest pharmaceutical companies says Pharmac's restrictive drug-buying model is holding back investment in clinical trials in New Zealand.
Jeffrey Nye is the global head of external innovation for neuroscience at Johnson and Johnson pharmaceutical company Janssen.
He is in New Zealand for the first time, looking at research and investment opportunities with academics and biotechnology start-ups.
Dr Nye says New Zealand's outstanding medical facilities offers a lot of potential for clinical trials.
"I think that New Zealand has a wonderfully diverse population with terrific academic investigators, which is really the foundation of good clinical trial experience.
"So it's an opportunity for us to continue to work with these wonderful partners and test new medicines on patients who are willing."
Clinical trials require comparative medicines that are the best in their field to enable researchers to assess whether the new medicines being trialed are a significant improvement.
But Dr Nye says the New Zealand Government's drug-buying agency Pharmac is a stumbling block, because it does not make many of the comparative medicines available.
"New Zealand as a driver of innovation would clearly benefit by having global, international standards as far as top medicines that are sold and offered here and supported by the Government, which would enable us to do clinical trials on new medicines that might be competitive.
"But also to have a favourable incentive for companies to invest here, there has to be some security that eventually the research that we do will lead to products being sold here.
"That means there has to be a fairly facile discussion with the authorities to approve new medicines for their offering to the public."
Dr Nye says he is taking the first step in exploring new partnerships in New Zealand, mainly in neuroscience.