The Pharmaceutical R&D Model is Broken. Here's How to Fix It

Xconomy -- Research is the lifeblood of the biotech and pharmaceuticals business. The pharma and biotech industry spent some $65 billion dollars on R & D in 2008, according to the Pharmaceutical Research and Manufacturers Association. That’s a tremendous amount of money considering that the FDA only approved 24 new drugs (21 new molecular entities and 3 biologics) that same year. If the PhRMA numbers are true, this would imply that it cost about $2.7 billion/drug to win FDA approval, a very poor return on investment since few drugs would ever be able to recoup that expense.