The Truth About Drug Innovation

The increasingly important role of prescription medicines as both complements to and substitutes for other medical procedures, as well as rising costs for newer and more effective medicines, has precipitated an array of proposals for reducing private and public spending on drugs. Some prominent observers have questioned whether the current system of research and development is as cost-effective as alternatives might be, and, in particular, whether the central role of private pharmaceutical firms in drug research and development produces commensurate social benefits. One contention that recently has attracted considerable attention can be summarized as follows: most of the scientific advances that yield new and improved medicines are the fruit of research financed or conducted by public agencies, the National Institutes of Health (NIH) foremost among them, rather than the pharmaceutical companies that produce and market them.

The goal of this study is to test the accuracy of this proposition. To do so, we compiled summary case histories of thirty-five drugs and drug classes (a group of drugs used to treat a given medical condition in similar ways) identified in the scholarly literature as important and/or that were among the most prescribed in 2007. Our conclusions can be described as follows: the literature on the histories of drugs makes it clear that the scientific contributions of the private sector were crucial for the discovery and/or development of virtually all of the thirty-five drugs and drug classes examined in this study. Such scientific advances can be classified as the basic science of biology and disease processes relevant for given medical conditions; the applied science of discovering compounds that treat particular conditions; and the development of compounds with improved clinical (medical) effects, of large-scale manufacturing processes, and the like.

More generally, among our thirty-five drugs and drug classes, private-sector research was responsible for central advances in basic science for seven, in applied science for thirty-four, and in the development of drugs yielding improved clinical performance or manufacturing processes for twenty-eight. In short, all or almost all of the drugs and drug classes examined in this study would not have been developed—or their development would have been delayed significantly—in the absence of the scientific or technical contributions of the pharmaceutical firms.