According to new market survey, pharma industry continues to invest heavily on basic research

In 2017 the world’s top-21 pharmaceutical companies further increased expenditure on basic research, spending up to €85bn, i.e. +3.7% compared to 2016. It should be noted that over 40% of said funds were invested on new anti-cancer therapies. On average, companies invest 19.5% of their revenue on these treatments – which confirms that pharma is among the sectors investing the most on the search for new solutions.  The data came from a report issued by consulting company Ernst and Young. According to it, Germany-based Boehringer Ingelheim is among the companies which invested the most, whereas biotech companies Biogen, Amgen and Gilead invested below average. What is reassuring is that an increased investment in R&D corresponds to an increased number of drugs put on the market. In particular, the report showed that the number of drugs marketed in 2015 (as for the top-21 companies in question) increased by 85%. For example, 80 new products were proposed in 2016 as opposed to 173 in 2017. However, financial performance is not as positive as investment; indeed, the top-21 companies’ revenues increased only by 0.4%, adding up to €447.5bn, whereas EBIT even dropped by 2.4% in 2017 (€151bn). Notwithstanding this trend, the three most important German pharma companies – Bayer, Boehringer Ingelheim and Merck KGaA – saw their sales volume rise by 3.3%, reaching €36.5bn, and their EBIT also rose by 11% in 2017 vs 2016.

 

(Source: FAZ)