Pharmaceutical companies cut down on R&D, push sales of old drugs: report

The pharmaceutical industry have cut spending on research and development (R&D) and is relying heavily on sales of an aging portfolio of drugs, whilst new drugs launched in the past five years account for only 7 per cent of the industry sales, according to data released today.

The data released by CMR International, a Thomson Reuters business, shows that the majority of sales for the world's leading pharmaceutical companies are derived from the most mature drugs, with the top three drugs for a company on average contributing 44 per cent of total sales.

"The latest data shows that poor productivity in 2009 continued to be exasperated by the low success rate for drugs in late stage development and a decline in sales from new drugs launched within the last 5 years," said Hans Poulsen, head of consulting at CMR International.

"The increase in NME launches compared with 2008 offers some positive news. However, with data indicating a continued drop in overall success rates, it remains to be seen if the industry can reverse a 10-year trend in declining R&D output."

The report said a general decline in success rates for new drugs also has taken its toll on productivity and indicative of this is a doubling of phase III terminations in the period 2007-2009 compared with those in 2004-2006.

Further analysis of the data reveals that less than 1 in 10 drugs reaching 'first toxicity dose' can now expect to be successfully launched.