ArticlePharmacoEconomics2002
Returns on research and development for 1990s new drug introductions.
Article in PharmacoEconomics, 2002. The graph could read no effect estimate from its abstract, so it casts no vote on the map. Cited by 38 papers.
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Who cites it
38 citing papers in PubMed.
- Pharmaceutical Pricing and R&D as a Global Public Good.Health economics · 2026Article
- Disease foci of pharmaceutical research and development as reflected in applications for International Nonproprietary Names, 1953-2022.Bulletin of the World Health Organization · 2025Article
- Why is the market design for innovative pharmaceuticals not well understood?Journal of comparative effectiveness research · 2024Article
- Conducting Drug Treatment Trials in Children: Opportunities and Challenges.Pharmaceutical medicine · 2024Review
- Dividend policy issues in the European pharmaceutical industry: new empirical evidence.The European journal of health economics : HEPAC : health economics in prevention and care · 2023Article
- Valuation and Returns of Drug Development Companies: Lessons for Bioentrepreneurs and Investors.Therapeutic innovation & regulatory science · 2022Article
- One swallow does not make a summer: episodes and persistence in high growth.Small business economics · 2022Article
- Drugs Becoming Generics-The Impact of Genericization on the Market Performance of Antihypertensive Active Pharmaceutical Ingredients.International journal of environmental research and public health · 2021Article
- The FDA and the COVID-19: A political economy perspective.Southern economic journal · 2021Article
- Financing Drug Innovation in the US: Current Framework and Emerging Challenges.PharmacoEconomics · 2020Review
- The financial performance of the health care industry: a global, regional and industry specific empirical investigation.The European journal of health economics : HEPAC : health economics in prevention and care · 2018Article
- Assessing the Financial Value of Patient Engagement: A Quantitative Approach from CTTI's Patient Groups and Clinical Trials Project.Therapeutic innovation & regulatory science · 2018Article
- New Product Development in the Pharmaceutical Industry: Evidence from a generic market.Iranian journal of pharmaceutical research : IJPR · 2017Article
- The opportunity cost of capital: development of new pharmaceuticals.Inquiry : a journal of medical care organization, provision and financing · 2015Article
- New Zealand's drug development industry.International journal of environmental research and public health · 2013Review
- ENTRY IN THE ADHD DRUGS MARKET: WELFARE IMPACT OF GENERICS AND ME-TOO'S.The Journal of industrial economics · 2013Article
- ChemVassa: A New Method for Identifying Small Molecule Hits in Drug Discovery.The open medicinal chemistry journal · 2012Article
- Competitiveness in follow-on drug R&D: a race or imitation?Nature reviews. Drug discovery · 2011Review
- Deconstructing the drug development process: the new face of innovation.Clinical pharmacology and therapeutics · 2010Review
- Patents, innovation, and the welfare effects of Medicare Part D.Advances in health economics and health services research · 2010Article
Corrections and comments
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Authors and funding
3 authors.
Funding
No grant is acknowledged in the PubMed record.
Abstract
backgroundPreviously published research by the authors found that returns on research and development (R&D) for drugs introduced into the US market in the 1970s and 1980s were highly skewed and that the top decile of new drugs accounted for close to half the overall market value. In the 1990s, however, the R&D environment for new medicines underwent a number of changes including the following: the rapid growth of managed-care organisations; indications that R&D costs were rising at a rate faster than that of overall inflation; new market strategies of major firms aimed at simultaneous launches across world markets; and the increased attention focused on the pharmaceutical industry in the political arena.
objectiveThe aim of this study was to examine the worldwide returns on R&D for drugs introduced into the US market in the first half of the 1990s, given that there have been significant changes to the R&D environment for new medicines over the past decade or so.
resultsAnalysis of new drugs entering the market from 1990 to 1994 resulted in findings similar to those of the earlier research - pharmaceutical R&D is characterised by a highly skewed distribution of returns and a mean industry internal rate of return modestly in excess of the cost of capital.
conclusionsAlthough the distribution of returns on R&D for new drugs continues to be highly skewed, the analysis reveals that a number of dynamic forces are currently at work in the industry. In particular, R&D costs as well as new drug introductions, sales and contribution margins increased significantly compared with their 1980s values.
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Registered trials
Read under generation 80e0d062 · epoch 390. Bibliography from PubMed, PubMed Central and OpenAlex; grants from NIH RePORTER; trial links from ClinicalTrials.gov; estimates, votes and beliefs from the OpenQuestion graph.