Demythologizing the high costs of pharmaceutical research

Light, Donald W.; Warburton, Rebecca

doi:10.1057/biosoc.2010.40

Cited by 165 publications

(116 citation statements)

References 21 publications

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“…For example, the average research and development cost per pharmaceutical development has been reported to be $2558 M by DiMasi et al (2016) but less than $59 M by Light and Warburton (2011). Appendix B navigates through such inconsistent historical reports, but also consistent open data and recent investigations, and concludes that the pharmaceutical development returns have been relatively stable.…”

Section: Rate Of Returns Of Pharmaceutical Developments Todaymentioning

confidence: 97%

“…Reported estimates of average research and developments cost are $802 M (see DiMasi et al 2003) per successful drug, including the cost of failures, or more recently $2558 M (see DiMasi et al 2016). Such numbers are debated to be less than $59 M and it is suggested that most publicly available data in the field are biased (see Light and Warburton 2011;and Lazonick et al 2017).…”

Section: Appendix B Investigation Of the Current Rate Of Return Of Pmentioning

confidence: 99%

See 1 more Smart Citation

Can Pension Funds Partially Manage Longevity Risk by Investing in a Longevity Megafund?

Debonneuil

Eyraud-Loisel

Planchet

2018

Risks

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Abstract:Pension funds, which manage the financing of a large share of global retirement schemes, need to invest their assets in a diversified manner and over long durations while managing interest rate and longevity risks. In recent years, a new type of investment has emerged, that we call a longevity megafund, which invests in clinical trials for solutions against lifespan-limiting diseases and provides returns positively correlated with longevity. After describing ongoing biomedical developments against ageing-related diseases, we model the needed capital for pension funds to face longevity risk and find that it is far above current practices. After investigating the financial returns of pharmaceutical developments, we estimate the returns of a longevity megafund. Combined, our models indicate that investing in a longevity megafund is an appropriate method to significantly reduce longevity risk and the associated economic capital need.

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Section: Rate Of Returns Of Pharmaceutical Developments Todaymentioning

confidence: 97%

Section: Appendix B Investigation Of the Current Rate Of Return Of Pmentioning

confidence: 99%

Can Pension Funds Partially Manage Longevity Risk by Investing in a Longevity Megafund?

Debonneuil

Eyraud-Loisel

Planchet

2018

Risks

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“…The price of medicines is then set in order to recoup the high investment and offset the high risk of drug development. But this figure remains controversial, with others suggesting the cost might be as low as $43 million on average [7]. Indeed the CEO of GSK, Sir Andrew Witty, recently proclaimed that the billion dollar figure was "one of the great myths of the industry" [8].…”

Section: The Problem Of Pricingmentioning

confidence: 99%

Alternative strategies in orphan drug development

Hall

Sireau²

2013

Expert Opinion on Orphan Drugs

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“…Research and development costs are estimated to be more than $1 billion/drug that reaches the market (22), providing pharmaceutical companies with a justification for the high prices of new drugs. However, these data were recently disputed (23).…”

Section: Distribution Of Cancer Care Costsmentioning

confidence: 99%

Contribution of Imaging to Cancer Care Costs

Yang¹,

Czernin²

2011

J Nucl Med

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Health care costs in the United States are increasing faster than the gross domestic product (GDP), and the growth rate of costs related to diagnostic imaging exceeds those of overall health care expenditures. Here we show that the contribution of imaging to cancer care costs pales in comparison to those of other key cost components, such as cancer drugs. Specifically, we estimate that 18 F-FDG PET or PET/CT accounted for approximately 1.5% of overall Medicare cancer care costs in 2009. Moreover, we propose that the appropriate use of 18 F-FDG PET or PET/CT could reduce the costs of cancer care. Because the U.S. health care system is complex and because it is difficult to find accurate data elsewhere, most cost and use assessments are based on published data from the U.S. Centers for Medicare & Medicaid Services.

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Demythologizing the high costs of pharmaceutical research

Cited by 165 publications

References 21 publications

Can Pension Funds Partially Manage Longevity Risk by Investing in a Longevity Megafund?

Can Pension Funds Partially Manage Longevity Risk by Investing in a Longevity Megafund?

Alternative strategies in orphan drug development

Contribution of Imaging to Cancer Care Costs

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