Comparison of Sales Income and Research and Development Costs for FDA-Approved Cancer Drugs Sold by Originator Drug Companies

High costs and the risks of R&D have long been used to justify the high prices of cancer drugs. However, new research has found that cancer drugs have generated returns far in excess of R&D costs. 

In this recent 2019 study published in JAMA, investigators from @WHO sought to compare sales of cancer drugs with estimated R&D costs. Identifying 156 FDA-approved cancer drugs between 1989 to 2017, the study filtered down to 99 drugs (63.5%) with available data (at least half or more of sales data since approval). 

Itemized product sales data were extracted from the originator companies’ consolidated financial reports. For R&D costs of cancer drugs, the analysis used the estimates presented in a 2017 JAMA study that calculated the median risk-adjusted R&D cost as $794 million (range, $219 - $2,827 million).

On average, pharmaceutical companies made over 10 times what it costs to discovery drugs. For the 99 FDA-approved oncology drugs with available sales data, these drugs generated a median cumulative revenue of $14.50 for every $1 spent on R&D through the end of 2017.

Half the drugs examined in the study had generated sales of over $5 billion through the end of 2017, with these leading the way: imatinib ($63.8 billion), pegfilgrastim ($64.0 billion), bevacizumab ($83.4 billion), trastuzumab ($88.2 billion), and rituximab ($93.7 billion).