Cost to bring a drug to market drops to under $2B for the first time in over five years

Insights from a Clarivate Analytics report " 2019 Centre for Medicines Research (CMR) International Pharmaceutical R&D Factbook"  show there are two main factors in the pharmaceutical industry that are causing the increase in drug approvals and subsequently the decrease in cost per new molecular entity (NME).

The first is an increased focus on rare diseases. Of the 57 NMEs launched in 2018, 22 had an orphan drug designation, indicating that they targeted a rare disease.

The second contributing factor is increased activity from smaller pharmaceutical companies. In 2018, 74% of drug launches were developed by companies with an R&D spend of $700 million to $2 billion, which is almost double the contribution this group made in 2009. Major pharma companies (R&D spend of greater than $2 billion) accounted for just 26% of drug launches.