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New Drug Development Term Paper

Future of Clinical Research: Focusing on New Drug Costs The objective of this study is to examine the future of clinical research with a focus on new drug costs. Toward this end three reports will be examined that analyze this issue. Drug development costs are unbelievably high and this results in pharmaceutical companies being slow to develop drugs.

Forbes Report

According to a report published by 'Forbes' there is "one factor, as much as anything else, determines how many medicines are invented, what diseases they treat, and, to an extent, what price patients must pay for them: the cost of inventing and developing a new drug, a cost driven by the uncomfortable fact than 95% of the experimental medicines that are studied in humans fail to be both effective and safe." (Herper, 2013, p. 1) Forbes reports that in an analysis conducted that findings show that "A company hoping to get a single drug to market can expect to have spent $350 million before the medicine is available for sale. In part because so many drugs fail, large pharmaceutical companies that are working on dozens of drug projects at once spend $5 billion per new medicine." (Herper, 2013, p.1) This is an outrageous amount...

According to 'Forbes' 98 studies were examined in the study and only 66 of these companies developed one drug in the past ten years. The stated median cost for each drug developed is reported at $350 million and for companies that "approve more drugs, the cost per drug goes up -- way up -- until it hits $5.5 billion for companies that have brought to market between eight and 13 medicines over a decade." (Herper, 2013, p. 1)
II. Adams and Brantner (2005)

The study reported by Adams and Brantner (2006) report a study that examined data that was updated on a monthly basis on the late stages of drug development from 1989 to 2006. Findings on new drug development costs are shown in the following chart labeled Figure 1.

Figure 1 -- Costs of New Drug Development

Source: Adams and Brantner (2006)

The preclinical cost is slightly lower than the clinical cost in new drug development with the total cost of new drug development found to exceed $800 million. According to Adams and Brantner (2006) the argument has been stated that the larger companies "have economies of scale and scope in drug development that might…

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References

Adams, C. And Brantner, VV (2006) Estimating the Cost of new Drug Development: Is it Really $802 Million? Health Affairs. Retrieved from: http://content.healthaffairs.org/content/25/2/420.full.html

Hard Pills to Swallow: The New Drug War (2014) The Economist. Retrieved from: http://www.economist.com/news/international/21592655-drug-firms-have-new-medicines-and-patients-are-desperate-them-arguments-over

Herper, M. (2013) The Cost of Creating A New Drug Now $5 Billion, Pushing Big Pharma to Change. Forbes. 11 Aug 2013. Retrieved from: http://www.forbes.com/sites/matthewherper/2013/08/11/how-the-staggering-cost-of-inventing-new-drugs-is-shaping-the-future-of-medicine/
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