The arch abstraction on drug development costs was appear and the after-effects will amaze – costs accept added by 145% in the accomplished decade (1). In 2003 the Tufts Center for the Abstraction of Biologic Development appear what has become the banking criterion for comparing biologic development costs. In 2003 the boilerplate amount was estimated to be $800 million. The new cost–$2.6 billion. But I’ll explain below, why consumers are in fact accepting a abundant accord on what they pay at the pharmacy for drugs.
- Overview of the studies-
The abstraction break down costs into four buckets (2)(3):
- Pre-clinical/pre-human analysis costs
- Clinical abstraction and balloon costs
- Abortion rates
- A “cost of money factor” e.g. monies that could be invested elsewhere
The absolute costs for the discovery, balloon and abortion ante equals $1,395 million. The absolute time costs (cost of money) equals $1,163, in sum accretion $2,558 million.
The 2003 study, acclimated artefact abstracts that entered animal testing during 1983-1994. The 2014 study, acclimated artefact abstracts that entered animal testing during 1995-2007.
-My Take: Consumers are Accepting a Fair Accord -
Comparing the Tufts abstraction to the macro ambiance of inflationary costs bears out the about adherence of biologic amount increases anesthetized assimilate the U.S. consumer. The Customer Price Index (CPI) represents a “basket of essentials” a lot of U.S. households acquirement anniversary month-things like groceries, gasoline, electricity, shelter, medical necessities, etc… During the accomplished decade the CPI has added by 2.1% per year (4). This agency on boilerplate you and I paid 2.1% added anniversary year for our capital appurtenances and services.
The CPI aswell advance medical specific costs, both bloom casework and bloom products. Back 2005, you and I are paying 35% added for medical casework and drugs. Comparatively, if you accept to accept in the arete of the Tufts study, biologic manufacturers accept incurred a 145% access in costs to ascertain and advance new drugs afore those drugs are manufactured, marketed, sold, and again accurate for assurance and appearance 4 research. Include these added all-important abutment functions and costs grew afterpiece to 200% back 2003.
If not for the connected technological, process, and cost-saving efficiencies of biologic manufacturers and bloom payers-you, myself and the blow of the country would accept acquainted a abundant greater appulse in our aggregate wallets with every abounding prescription.
Navigate Your Company to Health, appointment www.compassx.com
Kyle J. Heppenstall
- (1) Press Release http://csdd.tufts.edu/news/complete_story/pr_tufts_csdd_2014_cost_study
- (2) Slide accouter presentation via webcast http://csdd.tufts.edu/news/complete_story/cost_study_press_event_webcast
- (3) Background of the Study
- (4) Bureau of Labor Statistics 2014 CPI summary