According to the “2008 Pharmaceutical Industry Profile” released by the Pharmaceutical Research and Manufacturers of America (PhRMA), R&D spending by PhRMA-member companies rose 2.5% to $44.530 billion in 2007. Member companies’ 2007 sales increased 6.6% to $271.515 billion. As a result, R&D as a percentage of sales was 16.4%, down from 17.1% in 2006. In 2006, biologics and biotechnology R&D accounted for 24.5% of the total R&D spending of $43.439 billion. For human-use pharmaceuticals, $34.111 billion was spent on domestic R&D in 2006 and $8.831 billion was spent on foreign R&D. Aside from the US, which accounted for 79.3% of 2006 R&D spending, the UK, Japan and Germany represented 5.2%, 1.9% and 1.3% of total spending, respectively. Also, in 2006, the prehuman/preclinical stage, phase I, phase II, phase III, approval stage and phase IV accounted for 27.2%, 6.7%, 13.1%, 28.1%, 6.1% and 12.9% of R&D expenditures, respectively. Uncategorized expenses accounted for 6.0%. In contrast to 2005, when the prehuman/preclinical stage accounted for the largest percentage of R&D spending, phase III accounted for the largest percentage in 2006.

Source: PhRMA