E-DRUG: R&D costs for drugs (5)
-------------------------------
There is a growing body of evidence demonstrating that, especially in the
last
decades, the great majority of new products introduced on to the market
represented in fact no or little advantage for patients but have been a
significant burden for health budgets (1).
I agree with Norman Z. Nyazema on the essential and critical role of Phase
III
trials in drug development. However, I believe that it would be wrong if
only
drug development should be considered for finding ways where costs can be
cut.
If we have to consider improving the efficiency (and cost-efficiency) of the
pharmaceutical industry in developing and marketing new products, as for any
other industry all its business area should be considered, not just R&D. It
is
worth noting here that the industry spends on average significantly more on
marketing, advertising and administration (around 27% of total revenues)
than
on R&D (around 11% of total revenues) (2). Any cost-containing achievement
in
the marketing sector would therefore be worth around two and half times more
than on R&D in terms of final costs to patients.
Even profits normally exceed R&D spending: Merck's profits were nearly three
times the amount the company spent on R&D in 2001; BMS's profits were
greater
than twice the amount spent on R&D in 2001; on average, the nine US
companies
manufacturing or marketing the 50 top selling drugs for seniors in the USA
reported profits of 18% of total revenues, but only 11% of total revenues
were
allocated to R&D.
How about some cost savings in the above areas then, before endangering
Public
Health with less rigorous Phase III trials? Actually, it could be argued
that
spending more during Phase III drug development, for example through the use
of comparative (superiority) trials where these are possible, may benefit
consumers (both individually and through public Health Insurance Schemes)
and
the industry at the same time (3): on one hand, the results obtained through
comparative trials (although more expensive) would finally prove in a
scientific way the true added therapeutic value of new drugs. On the other,
it
could be for the industry a powerful marketing tool against competitors,
sparing companies some of the huge effort and resources now required to
convince doctors, patients, health services and regulatory agencies about
the
vague merits of new drugs. I believe this would be an argument worth of
further investigation.
(1) Changing Patterns of Pharmaceutical Innovation. A research report by The
National Institute for Health Care Management. Available from URL:
http://www.nihcm.org/innovations.pdf
(2) Profiting from Pain: where prescription drug dollars go. A Report from
Families USA, July 2002. Available from URL:
http://www.familiesusa.org/site/DocServer/PPreport.pdf?docID=249
(3) L. Li Bassi, V. Bertele�, S. Garattini. European regulatory policies on
medicines and public health needs. European Journal of Public Health, 2003;
3
(13): 246-251
Luca Li Bassi, MD, Dip Mgt, DPH
Laboratory of Regulatory Policies
Mario Negri Institute for Pharmacological Research
Milan
Italy
libassi@marionegri.it
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