The HIV/AIDS crisis in the late 1990s brought access to medicines challenges to public attention, when millions of people in developing countries died from an illness for which medicines existed, but were not available or affordable.
It depends who you ask. The lack of transparency around R&D costs is a massive problem. According to the pharmaceutical industry, it costs US$1.2–2.6 billion to bring a new medicine to market. But the Drugs for Neglected Diseases initiative (DNDi), a non-profit organisation that develops new medicines, says it costs much less—€100–150 million (approximately US$113–169 million), excluding in-kind contributions from partners. DNDi’s estimate is based on the actual costs for products that it has, or is, developing. Interestingly, although Novartis’ expenditure on the development of its cancer drug, Gleevec® (imatinib), is estimated to be US$38–96 million, it made a staggering US$4.675 billion in sales in 2012 (US$390 million per month).
The global pharmaceutical and biotech R&D expenditure in 2013 was US$51.6 billion, according to the Pharmaceutical Research and Manufacturers of America. Meanwhile, that same year, the pharmaceutical industry spent US$90 billion on marketing—twice its R&D expenditure.
You and me!
We all pay for the R&D of new medicines by buying medicines out-of-pocket, or through our health insurance, social security and/or taxes. Mostly, we pay through high drug prices.
Governments also contribute to the research cost of new medicines. A study of medicines approved by the United States Food and Drug Administration (FDA) between 1990 and 2007 showed that, of all newly discovered drugs, 10 per cent were discovered through public sector research. But if one looks at the medicines that were eligible for ‘priority review’ by the FDA (meaning that they were of greater importance for health), the share of public sector review doubles to 20 percent. This also indicates that public sector research for new medicines has a greater impact for public health than the new medicines researched by the industry.
Shouldn’t governments demand more control over the money they spend on medicines?