The Pharmaceutical Research and Manufacturers of America’s (PhRMA) “2007 Pharmaceutical Industry Profile” reports that, in 2006, total sales for PhRMA member companies increased 4.2% to $245.8 billion. In 2006, PhRMA member companies spent an estimated $43.0 billion on R&D, a 7.8% increase. R&D as a percentage of sales among member companies in 2006 is estimated at 17.5%, up from 16.9% in 2005. The report also provides specific breakdowns of R&D spending for 2005. Of the $39.4 billion spent on human-use pharmaceutical R&D in 2005, 76.9% went to domestic R&D and 22.0% went to overseas R&D. The UK and Japan were the most popular locations for this overseas R&D, accounting for 5.2% and 2.6% of the total figure for world R&D, respectively. The two R&D phases that received the largest portions of spending in 2005 were prehuman/preclinical research (25.7%) and Phase III testing (25.5%).

Source: PhRMA