Fewer new drugs from the pharmaceutical industry

A better understanding of the economic challenges facing research based companies is needed

In 2002 spending on medicines exceeded $400bn (£248bn; €377bn) worldwide. Optimists in the pharmaceutical industry believe that the global market for their products will go on expanding by around 10% a year, with the United States continuing to lead towards higher per capita outlays.1 Expenditure on research by the pharmaceutical industry is also increasing worldwide. It is now over $45bn a year—twice the sum recorded at the start of the 1990s—and projected to rise to $55bn by 2005-6.2 Concerns are growing, however, about the productivity of research being funded by the major pharmaceutical companies.

Industry leaders have argued that advances in areas such as genomics will in time identify many new targets for pharmaceuticals to act on.3 Yet some analysts fear that current programmes will not deliver innovations that are capable of generating the earnings currently coming from high selling medicines close to the end of the lives of their patents. The changed nature of future pharmaceutical products and the marketing support they need may mean that the business model underpinning the mainstream pharmaceutical industry …