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Who Develops Medicines? A New Study Highlights Role of Private Investment

May 14, 2021

Discussion around drug pricing often raises the issue of just how much NIH funding drives the development of new therapies. The general perception is that NIH funding is largely responsible for the creation and approval of new therapies. However, a new study by VitalTransformation (sponsored by BIO and PhRMA) finds that perception to be misguided.

The study identified patents linked to NIH grants from a single year, identifying those associated with clinical trials and approved medicines, and quantifying the public and private investments made for those investigational and approved medicines.

The findings: 23,230 NIH grants in the year 2000 were linked—by NIH-supported patents—to 18 FDA-approved medicines in 2020. Yet,none of the 18 FDA- approved medicines in 2020, which were supported by NIH grants, “reached approval without significant private investment”.

Notably, the study also found that “total private investment for the 18 approved medicines exceeded NIH funding by orders of magnitude: $44.2 billion in private investment compared to $670 million in NIH funding.”

Read the executive summary HERE.