(Bloomberg) — It costs drugmakers $2.6 billion to bring a new medicine to market, on average, more than double the price of 11 years ago, according to a study released today.
The higher cost comes from clinical trials that are larger and more complex, as well as more drugs that fail in development, according to the researchers. While the Food and Drug Administration is sometimes blamed for driving up costs because of the time it takes to review new drugs, that wasn’t a factor, according to the study by the Tufts Center for the Study of Drug Development.
“Drug development remains a costly undertaking despite ongoing efforts across the full spectrum of pharmaceutical and biotech companies to rein in growing R&D costs,” Joseph DiMasi, director of economic analysis at the Boston-based center, said in a statement.
Drug and biotechnology companies have come under pressure from lawmakers and health insurance companies to justify the costs of of their products. It’s a long-running debate that’s been reignited with the introduction of treatments like Gilead Sciences Inc.’s hepatitis C pill, Harvoni, which costs $94,500 for a 12-week course. The new drugs are the product of breakthrough science — and come with breakthrough price tags.
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As of the Tufts Center’s last estimate, in 2003, it cost $1 billion in 2013 dollars to develop a new brand-name drug. About 40 percent of the center’s funding comes from drug companies, with the rest from research grants and educational course fees.