Skip to main content
SpringerLink
Log in

Macro trends in pharmaceutical innovation

  • Opinion
  • Published:

From Nature Reviews Drug Discovery

View current issue Sign up to alerts

Abstract

Critics decry the lack of 'truly innovative' new medicines and question the role of the pharmaceutical industry in creating the few that are developed. Is this an accurate portrayal of the state of pharmaceutical innovation? Does major pharma still innovate? If so, how? Must the industry innovate to survive? These and related issues are discussed.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Figure 1: Distribution of drug patents by assignee 1982–2000.
Figure 2: Pharma R&D spending.
Figure 3: Pharmaceutical industry allocation of R&D expenditures selected years 1976–2002.
Figure 4: Pharmaceutical industry scientific and engineering personnel compared with aggregate industrial scientific and engineering personnel 1958–1999.
Figure 5: Center for Drug Evaluation and Research NDA approvals 1990–2003.
Figure 6: Recent trends in marketing authorization filings with the FDA.
Figure 7: Drugs in development by Phase, 1995–2004.

Similar content being viewed by others

References

  1. Scherer, F. M. The link between gross profitability and pharmaceutical R&D spending. An analysis that answers the question: what does the pharmaceutical industry really do with its profits? Health Affairs 20, 216–220 (2001).

    Article  CAS  Google Scholar 

  2. US Congress, Office of Technology Assessment. Innovation and Commercialization of Emerging Technology OTA-BP-ITC–165 (Washington DC, US Government Printing Office, 1995).

  3. National Research Council. Prospectus for national knowledge assessment. Committee on Knowledge Assessment Office of International Affairs (Washington DC, National Academy Press, 1996).

  4. Booth, B. L. & Zemmel, R. W. The search for blockbuster drugs: efficacy isn't everything. The McKinsey Quart. 4 (2004).s

  5. Wertheimer, A., Levy, R. & O'Connor, T. Too many drugs? The clinical and economic value of incremental innovations'. Investing in health: the social and economic benefits of health care innovation 14, 77–118 (2001).

    Chapter  Google Scholar 

  6. Roberts, P. W. Product innovation, product-market competition and persistent profitability in the U. S. pharmaceutical industry. Strategic Manag. J. 20, 655–670 (1999).

    Article  Google Scholar 

  7. Grabowski, H. & Vernon, J. in Competitive Strategies in the Pharmaceutical Industry. (ed. Helms, R.) 194–207 (Washington DC, AEI, 1996).

    Google Scholar 

  8. Ben-Asher, D. In need of treatment? Merger control, pharmaceutical innovation & consumer welfare. Discussion Paper No. 270 (Harvard Law School, Boston, 1999).

    Google Scholar 

  9. Congress of the United States Congressional Budget Office. How Increased Competition from Generic Drugs has Affected Prices and Returns in the Pharmaceutical Industry (Washington DC, US Government Printing Office, 1998).

  10. Federal Trade Commission. To Promote Innovation: the Proper Balance of Competition and Patent Law and Policy [online], <http://www.ftc.gov/os/2003/10/innovationrpt.pdf> (2003).

  11. Grabowski, H. G. Patents and new product development in the pharmaceutical and biotechnology industries. Georgetown Public Policy Rev. 8, 87–104 (2003).

    Google Scholar 

  12. US Congress, Office of Technology Assessment. Pharma-ceutical R&D: Costs, Risks and Rewards OTA-H–522 (Washington DC, US Government Printing Office, 1993).

  13. Pharmaceutical Research and Manufacturers of America. Industry Profile 2003 [online], <http://www.phrma.org/publications/> (2003).

  14. Grabowski, H., Vernon, J. & DiMasi, J. Returns on R&D for 1990s new drug introductions. Pharmacoeconomics 20, 11–29 (2002).

    Article  Google Scholar 

  15. US Congress, Office of Technology Assessment. Patent Term Extension and the Pharmaceutical Industry (Washington DC, US Government Printing Office, 1981).

  16. Pharmaceutical Research and Manufacturers of America. Delivering on the Promise of Pharmaceutical Innovation: the Need to Maintain Strong and Predictable Intellectual Property Rights [online], <http://www.ftc.gov/os/comments/intelpropertycomments/phrma020422.pdf> (2002).

  17. Van Horn, C. E. in Biotechnology Innovation Report 2004 Benchmarks (ed. Michelson A. M.) 1–33 (Washington DC, Finnegan, Henderson, Frabow, Garrett & Dunner, LLP, 2004).

    Google Scholar 

  18. McGahan, A. & Silverman, B. How does innovative activity change as industries mature? Intl J. Ind. Organ. 19, 1141–1160 (2001).

    Article  Google Scholar 

  19. National Science Foundation. Science and Engineering Indicators 2004 Vol. 2. [online], <http://www.nsf.gov/sbe/srs/seind04/start.htm> (2004).

  20. National Science Foundation. Survey of Industrial Research and Development 1953–2003 [online], <http://www.nsf.gov/sbe/srs/sird/start.htm> (2004).

  21. US Department of Labour: Bureau of Labour Statistics Occupational Employment Statistics [online], <http://www.bls.gov/oes/home.htm#overview>

  22. Reichert, J. M. & Paquette C. Therapeutic recombinant proteins: trends in US approvals 1982 to 2002. Curr. Opin. Mol. Ther. 5, 139–147 (2003).

    CAS  PubMed  Google Scholar 

  23. Parexel's R&D Statistical Sourcebook 2004/2005 (ed. Mathieu, M. P.) (Parexel Intl Corp., Waltham, 2004).

  24. Anonymous. From pipeline to market 2004. R&D Directions 10, 19–74 (2004).

  25. Patent Statistics Reports [online], <http://www.uspto.gov/web/offices/ac/ido/oeip/taf/reports.htm>

  26. Pharmaceutical Research and Manufacturers of America. Industry Profile 2004 [online], <http://www.phrma.org/publications/> (2004).

  27. Department of Health and Human Services National Institutes Of Health. NIH response to the conference report request for a plan to ensure taxpayers' interests are protected [online], <http://www.nih.gov/news/070101wyden.htm> (2001).

  28. Department of Health and Human Services National Institutes of Health report to Congress on affordability of inventions and products [online], <http://ott.od.nih.gov/NewPages/211865ottrept.pdf> (2004).

  29. Center for Drug Evaluation and Research. Report to the Nation 2003: Improving Public Health Through Human Drugs [online], <http://www.fda.gov/cder/reports/rtn/2003/Rtn2003.pdf> (2003).

Download references

Acknowledgements

I would like to thank D. Cohen for his assistance with data collection and C. Neslusan and the anonymous reviewers for critical reading of the manuscript.

Author information

Authors and Affiliations

  1. founder, President and senior analyst at Crownstone, 3331 Street Road, Suite 140, Bensalem, 19020, Pennsylvania, USA

    Fredric J. Cohen

Authors
  1. Fredric J. Cohen
    View author publications

    You can also search for this author in PubMed Google Scholar

Ethics declarations

Competing interests

The author declares no competing financial interests.

Related links

Related links

FURTHER INFORMATION

Center for Biologics Evaluation and Research

Center for Drug Evaluation and Research

National Sciecne Foundation

Pharmaceutical Research and Manufacturers of America

Rights and permissions

Reprints and permissions

About this article

Cite this article

Cohen, F. Macro trends in pharmaceutical innovation. Nat Rev Drug Discov 4, 78–84 (2005). https://doi.org/10.1038/nrd1610

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1038/nrd1610

  • Springer Nature Limited

This article is cited by

Search

Navigation