The EU Industrial R&D Investment Scoreboard by Industry

The 2007 EU Industrial R&D Investment Scoreboard shows aggregate R&D spending by 2,000 of the world’s top companies rose 10% in fiscal 2006 to €371.6 billion ($464.5 billion). R&D expenditures by the 1,000 non-EU companies surveyed rose 11.1% to €250.5 billion ($313.1 billion), compared to 7.7% in 2005. R&D spending for the 1,000 EU companies examined rose 7.4% last year to €121.1 billion ($151.4 billion), up from growth of 5.3% in 2005. Non-EU companies also showed faster R&D spending growth on a three-year basis as their combined average growth rate (CAGR) for R&D investments rose 8.7% compared to EU companies’ 4.6% increase. According to the Scoreboard report, R&D spending by non-EU countries continues to outpace that of EU firms due to the proportion of R&D-intensive industry sectors, such as pharmaceuticals, biotech and IT-related companies, located in countries outside the EU. IBO calculated the fiscal 2006 growth rates for R&D spending in seven industries for which analytical instruments are vital for R&D. Among these industries, pharmaceuticals spent the greatest amount on R&D last fiscal year: more than €60,625 million ($75,781 million = €0.80 = $1). For the 127 pharmaceutical companies in the Scoreboard, R&D spending rose 14.8% last year. Three companies alone—Pfizer, Johnson & Johnson and GlaxoSmithKline—spent more than €5 billion ($6.25 billion) each on R&D in fiscal 2006, and 16 companies spent more than €1 billion ($1.25 million) each on R&D. The Scoreboard’s biotech companies showed the greatest year over year increase in total R&D spending, gaining 22.0% to €9,685 million ($12,106 million). Of the 20 biotech companies with fiscal 2006 revenues of more than €100 million ($125 million), five companies posted a three-year CAGR for R&D expenditures higher than 40%: the Netherlands’ Crucell (49.9%) and the US’ PDL Biopharma (47.8%), Biogen Idec (45.5%), Amylin Pharmaceuticals (42.7%) and MedImmune (42.1%). Oil and gas producers’ spending on R&D grew the second fastest in fiscal 2006 among the Scoreboard industries tracked by IBO, rising 20.5% to €4,952 million ($6,190 million). Among the 21 oil and gas producers in the Scoreboard, four companies, the UK’s Royal Dutch Shell, France’s TOTAL, the US’ Exxon Mobil and Brazil’s Petróleo Brasileiro, had 2006 R&D budgets of more than €500 million ($625 million). Posting the fastest growth in R&D spending both last year and in terms of CAGR over three years were Russia’s Gazprom and Petróleo Brasileiro. Semiconductor companies also recorded a double-digit increase in total R&D spending in fiscal 2006. The Scoreboard’s 128 semiconductor companies grew total R&D investments by 13.9% to €24,527 million ($30,659 million). Three companies, the US’ SanDisk and the UK’s CSR and Wolfson Microelectronics, recorded R&D spending growth of more than 50% in 2006 and as a CAGR from 2004–06. Nineteen semiconductor companies posted a three-year CAGR for R&D of more than 30%. Interestingly, fiscal 2006 total R&D spending for the Scoreboard’s 32 industrial metals companies also grew in the double digits, increasing 11.8% to €2,472 million ($3,090 million). The company with the largest R&D budget in fiscal 2006 was South Korea’s POSCO, which spent €267.9 million ($334.9 million) on R&D last year. It was also one of three industrial metals companies to spend more than €200 million ($250 million) on R&D last year and one of nine to spend more than €100 million ($125 million). The highest CAGR for 2004–06 for R&D spending belonged to Mittal Steel, which increased R&D expenditures by 90.0%. R&D spending last year by the 119 chemicals companies in the Scoreboard for which figures were provided rose 9.6% to €17,215 million ($21,519 million). With fiscal 2006 R&D budgets of more than €1 billion ($1.25 billion), Bayer AG and BASF dwarfed others companies’ spending. Fifteen companies recorded a three-year CAGR for R&D spending of more than 20%; however, 33 companies showed decreases over the same time period. The Scoreboard’s 52 food producers reported growth in total R&D spending of 6.3% in fiscal 2006 to €4,049 million ($5,061 million). Both last year and as a CAGR over three years, Switzerland’s Barry Callebaut grew R&D investments by more than 90%. The UK’s Premier Foods posted R&D increases for both periods in excess of 50%. Nestlé of Switzerland and UK-based Unilever were the only two food producers to have 2006 R&D budgets of more than €200 million ($250 million). Unilever’s three-year CAGR for R&D was -5.2%, while Nestlé’s was 12.9%. Nine food producers reduced their three-year CAGR for R&D.

< | >