Who are the largest investors in U.S. medical and health R&D?

A key contentious issue in the global narrative on drug pricing is the source of R&D. Where exactly are research and development dollars coming from? 

Based on a recent report from @ResearchAmerica, the private sector has and continues to invest more than any other stakeholder in the United States, accounting for 67% of total spending in 2017, followed by the federal government at 22%. Total U.S. medical and health R&D spending was $182.3 billion. Private industry invested $121.8 billion, of which 80% was accounted for by the biopharmaceutical sector. 

Federal agencies invested a total of $39.5 billion, with the National Institutes of Health (NIH) accounting for nearly $32.4 billion or 82.1% of federal spending.

The drug industry outspends the NIH by three-folds.

However, NIH funding has contributed to published research associated with every one of the 210 new drugs approved by the US FDA from 2010–2016. More than 90% of NIH funding represents basic research related to the biological targets for drug action rather than the drugs themselves. 

The role of NIH funding has complemented industry research and development, which focuses predominantly on applied research. This underscores the breath and significance of public and private collaboration in the development of new medicines.