If 2020 underscored the importance of the pharma industry’s social importance, 2021 demonstrated the industry’s ability to translate R&D spending into profitable commercialized products.
But while strong demand for COVID-19 therapies in 2021 provided unprecedented revenue levels for a handful of Big Pharma companies, it didn’t result in substantial changes in R&D spending. (Look out for more insights from our annual Pharma 50 report.)
In 2019, pharmaceutical companies spent an average of roughly 25% of their revenue on R&D, according to federal government statistics. In 2021, top R&D spenders invested closer to one-fifth of their revenue in R&D.
That’s slightly less with recent levels. Since 2010, the industry has invested about one-quarter of revenues in R&D.
While the pharma industry is clearly a global one, U.S.-based companies tend to invest the most in R&D.
The U.S. market plays an outsized role in supporting the global pharmaceutical market. It helps that FDA approvals of new drugs have ticked up in recent years, holding steady in 2021. The agency approved 50 novel drugs in 2021, which was roughly in line with the 53 drugs that won approval a year prior.
Below are the top R&D spenders internationally:
|Companies||R&D Spend||R&D as a percentage of revenue|
|2. Roche Pharmaceuticals (division of Roche Group)||$13,342,082,240||27.1%|
|3. Merck & Co.||$12,245,000,000||25.1%|
|4. Janssen (Johnson & Johnson’s pharmaceutical segment)||$11,882,000,000||22.8%|
|5. Bristol Myers Squibb||$11,354,000,000||24.5%|
|9. Eli Lilly||$7,025,900,000||24.8%|
|11. GlaxoSmithKline (GSK) (minus consumer segment)||$6,571,776,000||14.0%|
|12. Gilead Sciences||$5,363,000,000||19.6%|
|14. Takeda Pharmaceutical||$4,149,672,251||14.3%|
|15. Bayer (Pharmaceuticals Division)||$3,704,020,000||17.1%|
|16. Vertex Pharmaceuticals||$3,051,000,000||40.3%|
|17. Regeneron Pharmaceuticals||$2,908,100,000||18.1%|
|18. Novo Nordisk||$2,829,936,306||12.6%|
|20. Merck KGaA, Darmstadt, Germany/Merck Group/EMD Group||$2,434,340,000||12.8%|
Top R&D spenders ranked by overall spending.
Filed Under: RD