Reporter's Handbook: Key Industry and PhRMA Facts

Key Industry and PhRMA Facts

Research and Development (R&D)
Time to develop a drug = 10 to 15 years
Development CostsAverage cost to develop a drug
(including the cost of failures)
Early 2000s = $1.2 billion
Late 1990s = $800 million
Mid-1980s = $320 million
1970s = $140 million
R&D Spending by PhRMA Members
Year | PhRMA Member Spending
2013 $51.1 billion
2012 $58.5 billion
2011 $49.5 billion
2010 $50.7 billion
2009 $46.4 billion
2008 $47.4 billion
2007 $47.9 billion
2006 $43.0 billion
2005 $39.9 billion
2004 $37.0 billion
2000 $26.0 billion
1990 $8.4 billion
1980 $2.0 billion
Economic Impact of the Biopharmaceutical Sector
Direct jobs = More than 810,000 in 2013 (most recent data)
Total jobs = About 3.4 million in 2013 (including indirect and induced jobs, most recent data)

  • Medicines approved 2001-2011 = 340
  • In the 29 years since the Orphan Drug Act was established, 398 orphan drugs have been approved
  • Only 2 of 10 marketed drugs return revenues that match or exceed R&D costs

Medicines in Development
2011 = 3,240 compounds
2001 = 2,040 compounds
Value of Medicines

  • Cancer: Since 1980, life expectancy for cancer patients has increased about
  • 3 years, and 83% of those gains are attributable to new treatments, including medicines. Another study found that medicines specifically account for 50% to 60% of increases in survival rates since 1975.
  • Cardiovascular Disease: According to a 2011 statistics update by the American Heart Association (AHA), death rates for cardiovascular disease fell a dramatic31% between 1998 and 2008.
  • HIV/AIDS: Since the approval of the antiretroviral treatments (ART) in 1995, the U.S. AIDS death rate has dropped by more than 80%.

Generic share of market
2011 = 80%
2000 = 49%
About PhRMA
The Pharmaceutical Research and Manufacturers of America represents the country’s leading biopharmaceutical research companies, which are devoted to inventing medicines that allow patients to live longer, healthier and more productive lives. PhRMA companies are leading the way in the search for new cures.
PhRMA members alone invested an estimated $51.1 billion in 2013 in discovering and developing new medicines.
PhRMA is headquartered in Washington, D.C., and also has offices in Albany, Atlanta, Baton Rouge, Boston, Denver, Indianapolis, Olympia, St. Paul, Sacramento, Amman and Tokyo.
The association is governed by a 31-member board of directors. There are two categories of membership in PhRMA:

Any person, partnership, corporation, or subsidiary, division or unit thereof, in the United States of America or any of its territories or insular possessions, significantly engaged in the manufacture and marketing of finished dosage form ethical pharmaceutical or biological products under his or its own brand names for the cure, alleviation, mitigation, treatment, prevention or diagnosis of disease, and significantly engaged in pharmaceutical, biopharmaceutical or biological research and development of new molecular entities or new therapies, preventative, or in vivo diagnostics, or new systems of therapy, prevention, or diagnosis and who will continue to conduct such research and development.
Associates shall be persons, partnerships, corporations, or subsidiaries, divisions or units thereof, not eligible for membership as defined above, and not subsidiaries or divisions of or owned by a company engaged in the manufacture or marketing of finished dosage form pharmaceutical or biological products, who are: Engaged in research and development (significantly engaged, for profit, in biological research on their own behalf directly related to the development or production of ethical pharmaceutical or biological products for the cure, alleviation, mitigation, treatment or prevention of disease).

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