This article is a reprint of a summary of a press release based on a study, with no link to the actual study. Recent experience has lead me to be very mistrusting of things like that, so I poked around. I didn't find the actual study, but I did find some slides (<a href="http://csdd.tufts.edu/files/uploads/Tufts_CSDD_briefing_on_RD_cost_study_-_Nov_18,_2014..pdf" rel="nofollow">http://csdd.tufts.edu/files/uploads/Tufts_CSDD_briefing_on_R...</a>) about it.<p>$1.2B of this reported cost is "opportunity cost", based on the fact that you could have taken the money you would've used for drug development and invested it elsewhere... at a 10.5% real rate of return. Which is a rather questionable assumption.<p>Practice epistemic self defense: go to the primary sources!
Interesting, in the comments is a link to this Doctors Without Borders response, arguing that this figure is grossly overstated. They claim a number closer to $186M (taking into account cost of failures) <a href="http://www.doctorswithoutborders.org/article/rd-cost-estimates-msf-response-tufts-csdd-study-cost-develop-new-drug" rel="nofollow">http://www.doctorswithoutborders.org/article/rd-cost-estimat...</a><p>I don't know anything about this area, but would love to know whose figure is closer to right on this.
>In 2012, the pharmaceutical industry spent more than $27 billion on drug promotion— more than $24 billion on marketing to physicians and over $3 billion on advertising to consumers (mainly through television commercials). This approach is designed to promote drug companies' products by influencing doctors' prescribing practices.<p><a href="http://www.pewtrusts.org/en/research-and-analysis/fact-sheets/2013/11/11/persuading-the-prescribers-pharmaceutical-industry-marketing-and-its-influence-on-physicians-and-patients" rel="nofollow">http://www.pewtrusts.org/en/research-and-analysis/fact-sheet...</a>
See also this (opinion) piece in the NY Times, which disputes this calculation: <a href="http://www.nytimes.com/2014/11/19/upshot/calculating-the-real-costs-of-developing-a-new-drug.html" rel="nofollow">http://www.nytimes.com/2014/11/19/upshot/calculating-the-rea...</a>
Relevant: Eroom's law: <a href="http://www.nature.com/nrd/journal/v11/n3/fig_tab/nrd3681_F1.html" rel="nofollow">http://www.nature.com/nrd/journal/v11/n3/fig_tab/nrd3681_F1....</a><p>So what do we do here? We're not just underfunding basic biology research, it's rolling down hill and affecting the efficacy of our products oriented pharma R&D investments.<p>Best proposal I've heard to pull out of this trend? Computational biology: simulate different tissue types and organ systems (their dynamics, metabolic pathways, flow of matter/energy/information) and expose the simulated tissues to potential drugs in high-throughput simulations. Test exponentially more compounds and prune obvious failure from the chemical structure tree early and often. What you're left with is a restricted set of compounds to try synthesizing and taking to trial.
Costs are so high as these become more challenging, seems like Socialization with subsidy of incentive-based private funding (bonds, VCs) would be a better model.
This is a huge problem (even if this number is grossly inflated) - imagine the quantity of drugs that could exist if something like this could be bootstrapped.<p>I realize clinical trials are really important, because accidentally killing lots of people isn't particularly desirable, but is there a way we could lower this cost? What would need to happen?
Marketing is a pretty big part of the pie compared to R + D<p><a href="http://www.twnside.org.sg/title/twr131n.htm" rel="nofollow">http://www.twnside.org.sg/title/twr131n.htm</a>
> LaMattina counters that pricing should be based not on R&D costs but on the value a drug delivers to patients.<p>I love this line. We should do it for oxygen. Your bill is pretty high because oxygen delivers a lot of value.<p>Pricing should be based on cost of provision. Because if it is higher in a market economy someone else can enter the market and provide at a lower cost.
The $1.5 billion average cost is an average, and includes a lot of stupid ideas that should never have made it past the drawing board, but when you're a rich big pharma with tons of money to throw around, why not.<p>If you are smart (and quite lucky) it's an order of magnitude less.<p><a href="http://www.forbes.com/sites/bernardmunos/2014/11/20/the-ugly-cost-of-developing-new-drugs-can-we-make-it-prettier/" rel="nofollow">http://www.forbes.com/sites/bernardmunos/2014/11/20/the-ugly...</a>
Nature Reviews Drug Discovery published a good overview of the factors contributing to the high costs of drug development in 2010, along with some suggestions of how to mitigate cost increases. It's a good read for anyone interested in the subject.<p><a href="http://www.nature.com/nrd/journal/v9/n3/abs/nrd3078.html" rel="nofollow">http://www.nature.com/nrd/journal/v9/n3/abs/nrd3078.html</a>
That's on the order of the cost to buid new Intel fab.<p><a href="http://en.wikipedia.org/wiki/List_of_semiconductor_fabrication_plants" rel="nofollow">http://en.wikipedia.org/wiki/List_of_semiconductor_fabricati...</a>