Healthy Skepticism Library item: 1123

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Ryerson-cruz G.
Cost of testing drugs quadrupled, study says
Bloomberg News 2003 May 14

Full text:

BOSTON – The average cost of developing a new prescription drug is $897 million, nearly four times as much as in the early 1990s, according to a study by the Tufts Center for the Study of Drug Development.

The amount includes $802 million in pre-clinical and clinical costs, as estimated by the center in November 2001, plus $95 million in additional testing expenses after approval by the U.S. Food and Drug Administration, the report said.

“Drug development remains a time-consuming, risky, and expensive process,” Kenneth I. Kaitin, director of the Boston-based center, said in a statement on the university’s Web site. Companies are seeking to cut losses by identifying drug failures at early stages of development.

The Tufts Center study was based on an analysis of data covering 68 drugs from 10 multinational, foreign-owned, and U.S.-owned pharmaceutical firms during the 1990s. Included were products that won or failed to win marketing approval, as well as medicines still in development.

Of drugs that start the first of three stages in human trials, 22 percent go on to win approval for marketing in the United States, the study found. Kaitin said the rate of late-stage drug terminations dropped in the 1990s from the previous decade.

Post-approval research and development, which includes testing existing drugs for different uses, count for an average of 11 percent of development costs, the center said.