Year: 2003
Type: article
Abstract: Setting biomedical research priorities is one of the most important issues in health policy and ethics because it has broad implications for the advancement of medical knowledge, the improvement of clinical practice, the promotion of public health, and access to health care.For example, funding research on the human immunodeficiency virus (HIV) can enhance our knowledge of HIV; improve the treatment, diagnosis, and prevention of HIV; and increase access to health care for HIV patients.But since neither the government nor the private sector has an unlimited supply of money to spend on research and development (R & D), determining how to slice the research funding pie raises social and ethical questions related to justice and fairness.Most of the publicly funded biomedical research in the United States is sponsored by the National Institutes of Health (NIH), which had a $27 billion budget in 2002-2003.In the last 5 years, the NIH budget has nearly doubled. 1 Although the US government spends a great deal of money on biomedical research, private corporations spend more.In 2001, the companies belonging to the Pharmaceutical Research and Manufacturers of America (PhRMA) spent $30 billion on R & D, and companies belonging to the Biotechnology Industry Organization (BIO) spent $15.6 billion on R & D. [2][3] Seventy percent of the clinical trials conducted in the US are industry-sponsored.4 Any realistic policy that addresses research priorities must come to terms with the fact that private industry outspends the public sector when it comes to biomedical R & D. How Biomedical R & D Priorities Are Set in the United StatesThe economics of medical product development determines how pharmaceutical and biotechnology companies establish their funding priorities.According to industry estimates, it takes an average of $800 million and 10-15 years to develop a new drug, medical device, or biologic and bring it to the market.5 Since a patent on a new product lasts 20 years, a company will have 5-10 years to recoup its R & D investment while the product is still under patent.Once the patent expires, the company will lose its exclusive control over the product and its ability to make a significant profit.Although pharmaceutical companies tend to have relatively high profit margins (ie, 10 percent or more), they also take significant economic risks when they develop new drugs.Only 33 percent of new drugs are profitable, and very few drugs become "blockbusters," like Viagra or Prozac.Companies also
Source: The AMA Journal of Ethic
Author: David B. Resnik
Institution: East Carolina University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W81283528