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The productivity crisis in pharmaceutical R&D
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2010
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ProductivityProductivity GapPharmaceutical Supply ChainProductivity CrisisAttrition RatesIntellectual PropertyTechnology TransferPharmacoeconomicsDrug DevelopmentPharmacologyPharmaceutical BiotechnologyDrug ManufacturePharmaceutical IndustryPharmacyBusinessTherapeutic PatentMedicineD ProductivityDrug DiscoveryPharmaceutical Research
Since the molecular biology revolution, science has dramatically expanded the set of plausible therapeutic targets, yet innovation has become more difficult and attrition rates of R&D projects have risen, especially in late‑phase clinical trials. We analyze the decline of R&D productivity in pharmaceuticals and its determinants. The slowdown is linked to a higher concentration of R&D investments in high‑risk domains addressing unsolved therapeutic needs and unexploited biological mechanisms, and while European and US companies differ in portfolio composition, no productivity gap is evident.
We analyze the decline of R&D productivity in pharmaceuticals and its determinants. Since the molecular biology revolution, science has dramatically expanded the set of plausible therapeutic targets. However, innovation has become more difficult to achieve, and attrition rates of R&D projects have increased, especially in late-phase clinical trials. We show that the R&D productivity slowdown is associated with a higher concentration of R&D investments in high-risk domains, corresponding to unsolved therapeutic needs and unexploited biological mechanisms. We compare the strategies of European and US companies, finding differences in the composition of R&D portfolios, but no evidence of any productivity gap.