Johns Hopkins Health Alert
Why Is Prescription Medication So Costly?
Developing a new drug for use in humans is an expensive gamble. According to the Pharmaceutical Research and Manufacturers of America (PhRMA), researchers may screen as many as 10,000 different molecules to identify only 250 worthy of preliminary study in test tubes, cell cultures and laboratory animals. Of those 250 candidate drugs, only five might be suitable for testing in people. Only one of those five drugs may end up on the pharmacy shelf.
Along the way, pharmaceutical companies typically spend hundreds of millions of dollars and 10 to 15 years to create and market a new drug. The most expensive drugs to develop are those involving biotechnology techniques, such as genetically engineering bacteria to produce a medication.
An independent estimate by the Tufts Center for the Study of Drug Development pegged the average cost of developing a new biopharmaceutical at $1.2 billion, while clinical trial success rates have fallen to just 16 percent.
Sometimes, the industry loses the gamble. In December 2006, for example, the pharmaceutical company Pfizer pulled the plug on development of a promising medication for high cholesterol, torcetrapib, when research suggested it might raise the risk of heart attacks and death. In clinical trials, torcetrapib raised "good" high-density lipoprotein (HDL) cholesterol levels and was expected to become a blockbuster product. The company had already invested $800 million in this promising drug when it halted development.
Despite the costs, the industry continues to invest heavily in new products. In 2009, according to a PhRMA report, there were 312 drugs under development for heart disease and stroke, the leading causes of death in Americans.
Posted in Prescription Drugs on September 20, 2011
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