Top pharma lobby says R&D spending reached a peak in 2021
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The top pharmaceutical industry lobby PhRMA, which counts companies such as Pfizer (NYSE:PFE), AbbVie (ABBV) and Eli Lilly (LLY) as its members, said on Monday that the groupâs R&D expenditure reached the highest ever level in 2021.
Founded in 1958, the Pharmaceutical Research and Manufacturers of America (PhRMA) represents companies from Amgen (AMGN), Bristol Myers (BMY), Roche (OTCQX:RHHBY), GSK (GSK), J&J (JNJ) and Merck (MRK) to Biogen (BIIB) and Teva (TEVA).
In its 2022 annual survey, PhRMA noted that its members spent ~$102.3B as total R&D expenditure, the highest level going back to records in 1983. The R&D spending of PhRMA members has exceeded $1.1T over the past two decades.
2021 R&D expenditure, which includes $79.6B for domestic purposes and $22.7B as overseas spending, implies a ~12.2% YoY growth and more than double the level in 2021.
Meanwhile, from a ~1.0% YoY decline in the prior year, the total global sales of the PhRMA membership have bounced back in 2021 to record $482.8B with ~13.6% YoY growth. The R&D spending as a portion of the groupâs total sales has gradually increased over time, reaching ~21.2% in 2021, up from ~11.8% in 1983.
Noting that about one in every five dollars of revenue was spent on R&D, PhRMA said that in 2021, the FDAâs Center for Drug Evaluation and Research (CDER) and Center for Biologics Evaluation and Research (CBER) approved 50 and 10 new therapies, respectively.
PhRMA fiercely defends the industry in key issues such as legislative efforts to reduce drug pricing and waive IP rights for COVID-19 vaccines.