The pharmaceutical productivity gap – Incremental decline in R&D efficiency despite transient improvements

Kenneth D.S. Fernald; Philipp C. Förster; Eric Claassen; Linda H.M. van de Burgwal

doi:10.1016/j.drudis.2024.104160

The pharmaceutical productivity gap – Incremental decline in R&D efficiency despite transient improvements

Kenneth D.S. Fernald^*, Philipp C. Förster, Eric Claassen, Linda H.M. van de Burgwal

^*Corresponding author for this work

Research output: Contribution to Journal › Short survey › Academic › peer-review

Abstract

Rising research and development costs, currently exceeding $3.5 billion per novel drug, reflect a five-decade decline in pharmaceutical R&D efficiency. While recent reports suggest a potential turnaround, this review offers a systems-level analysis to explore whether this marks a structural shift or transient reversal. We analyzed financial data from the 200 largest pharmaceutical firms, novel drug approvals, and more than 80 000 clinical trials between 2012 and 2023. Our analysis revealed that despite recent stabilization, the pharmaceutical industry continues to face challenges, particularly due to elevated late-stage clinical attrition, suggesting that a sustained turnaround in R&D efficiency remains elusive.

Original language	English
Article number	104160
Pages (from-to)	1-8
Number of pages	8
Journal	Drug Discovery Today
Volume	29
Issue number	11
Early online date	5 Sept 2024
DOIs	https://doi.org/10.1016/j.drudis.2024.104160
Publication status	E-pub ahead of print - 5 Sept 2024

Bibliographical note

Publisher Copyright:
© 2024 The Author(s)

Keywords

Big Pharma
biotechnology
clinical attrition
innovation
pharmaceutical R&D
productivity
R&D efficiency

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10.1016/j.drudis.2024.104160

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title = "The pharmaceutical productivity gap – Incremental decline in R&D efficiency despite transient improvements",

abstract = "Rising research and development costs, currently exceeding $3.5 billion per novel drug, reflect a five-decade decline in pharmaceutical R&D efficiency. While recent reports suggest a potential turnaround, this review offers a systems-level analysis to explore whether this marks a structural shift or transient reversal. We analyzed financial data from the 200 largest pharmaceutical firms, novel drug approvals, and more than 80 000 clinical trials between 2012 and 2023. Our analysis revealed that despite recent stabilization, the pharmaceutical industry continues to face challenges, particularly due to elevated late-stage clinical attrition, suggesting that a sustained turnaround in R&D efficiency remains elusive.",

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AU - Claassen, Eric

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N2 - Rising research and development costs, currently exceeding $3.5 billion per novel drug, reflect a five-decade decline in pharmaceutical R&D efficiency. While recent reports suggest a potential turnaround, this review offers a systems-level analysis to explore whether this marks a structural shift or transient reversal. We analyzed financial data from the 200 largest pharmaceutical firms, novel drug approvals, and more than 80 000 clinical trials between 2012 and 2023. Our analysis revealed that despite recent stabilization, the pharmaceutical industry continues to face challenges, particularly due to elevated late-stage clinical attrition, suggesting that a sustained turnaround in R&D efficiency remains elusive.

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KW - clinical attrition

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KW - R&D efficiency

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The pharmaceutical productivity gap – Incremental decline in R&D efficiency despite transient improvements

Abstract

Bibliographical note

Keywords

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