Are Drugmakers Earning Returns On Their R&D Investments?

Once again, another report attempts to take stock of the pharmaceutical industry and the return on its many investments. And the latest finding suggests drugmakers are struggling, despite doing reasonably well at bringing new medicines to the marketplace, according to Deloitte and Thomson Reuters, which analyzed the 12 largest life sciences companies based on their R&D spending. So what did they learn? First, there is the good news. There were 105 products launched since 2010 with a projected value of $770 billion, and 167 assets with a projected value of $819 billion made it to late-stage development also since 2010. This would appear to be an impressive showing, at least amid the setbacks and cutbacks of the past several years. Just the same, the analysis goes on to offer some sobering findings otherwise. Projected R&D returns for the 12 companies fell to 4.8 percent last year from 10.5 percent in 2010. Late-stage terminations amounted to a loss of $243 billion during that four-year stretch. And the average forecast for peak sales of an asset declined by 43 percent, dropping to $466 million last year from $816 million in 2010. “Overall, R&D organizations are commercializing effectively. This has been particularly apparent over the last year. But they are failing to match this level of performance in other drivers of R&D economics, for example reducing the cost of success and boosting the rate of innovation,” says Julian Remnant, who heads the Deloitte Eu...
Source: Pharmalot - Category: Pharma Commentators Authors: Source Type: blogs