PhRMA member companies invested $83 billion in research and development (R&D) in 2019, the highest level of investment on record, according to the 2020 PhRMA member annual survey. Over the past two decades, PhRMA member companies have invested a grand total of nearly $1 trillion in the search for and development of new and better treatments and cures.
America’s biopharmaceutical companies are at the heart of a robust R&D ecosystem that develops more innovative medicines than any other country in the world. There are nearly 260 vaccines in development for the treatment or prevention of disease, including numerous different types of potential vaccines that target COVID-19.
R&D intensity at PhRMA member companies remains consistently high. In 2019, over 20% of revenue was devoted to R&D. Additionally, PhRMA member R&D spending accounted for most of the estimated $102 billion spent on R&D by the entire U.S. biopharmaceutical industry in 2018, the latest figure available. And the sector accounts for roughly one-sixth of total domestic R&D spending by U.S. businesses, the single largest share of all U.S. business R&D.
This focus on R&D investment has helped spur medical advances for U.S. patients:
- The U.S. Food and Drug Administration (FDA) approved 55 novel medicines in 2019, including the first vaccine to prevent Ebola, a gene therapy for spinal muscular atrophy which is a leading cause of infant mortality and two new treatments for sickle cell disease.
- Among potential medicines in clinical development, 74% are potentially first-in-class, meaning they represent an entirely new way of treating a medical condition.
- The United States has witnessed a 29% decline in cancer death rates since the early 1990s, with researchers attributing 73% of these outcomes to new treatments, including new medicines. In fact, new medicines have contributed to a 2.2% decline in cancer death rates in the most recently recorded year, the largest single year drop ever reported.
The complex R&D ecosystem is the foundation for the four million jobs the biopharmaceutical sector supports throughout the economy, including 130,000 biopharmaceutical researchers working tirelessly to develop new treatments and cures. Thanks to continued investment in R&D, we are closer every day to discovering the next lifesaving breakthrough.
Tim McClung Tim is a director of policy & research at PhRMA.