U.S. Drug Companies Spend $50 Billion a Year on Research with Few Breakthroughs

Sunday, June 09, 2013

Drug companies now spend about $50 billion annually to discover new medicines. But most of these new treatments are not significantly better than earlier drugs they were developed to replace, according to a new research study.


The research “showed that the effectiveness of new drugs, as measured by comparing the response of patients on those treatments to those taking a placebo, has plummeted since the 1970s,” Sharon Begley wrote at Reuters.


Dr Mark Olfson of Columbia University and statistician Steven Marcus of the University of Pennsylvania examined clinical trials comparing the effectiveness of drugs with placebos published between 1966 and 2010. In the early years, the drugs’ effectiveness averaged 4.5 times that of placebos. By the 1990s they were only twice as effective and by the 2000s just 36% better.


Several explanations have been suggested for this decline. Among them are: many of the most important discoveries have already been made; the patients who volunteer for clinical trials have become more difficult to treat; the quality of clinical trials has improved, with studies using a greater number of patients.


Others blame a weak regulatory system that allows pharmaceutical companies to make minor advances, market these new drugs aggressively and increase profits as each minor advance comes along.


The situation may get tougher for Big Pharma as the new federal healthcare law kicks in.


Under the Affordable Care Act, a new independent research institute will compare the effectiveness of different drugs for the same condition. The purpose of this work is to help patients, as well as private insurers and government programs such as Medicare, to spend their resources more wisely on the best therapies available.


This comparative analysis could result in new drugs being shunned in favor of older medicines that are now available in generic form—and that could mean fewer profits for pharmaceutical manufacturers.

-Noel Brinkerhoff, David Wallechinsky


To Learn More:

New Drugs Trail Many Old Ones in Effectiveness against Disease (by Sharon Begley, Reuters)

Decline In Placebo-Controlled Trial Results Suggests New Directions For Comparative Effectiveness Research (by Mark Olfson and Steven C. Marcus, Health Affairs (abstract)

The Most Transformative Drugs of the Past 25 years: a Survey of Physicians (by Aaron Kesselheim and Jerry Avorn, Nature Reviews Drug Discovery) (abstract)

As Government Funding of Drug Research Stagnates, Big Pharmaceutical Companies Move in with Distorted Test Results (by Noel Brinkerhoff, AllGov)


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