this is the pill that cures Hepatitis C. This is that pill on big Pharma

[True Earthling]

70. What are your sources? "biotech firms" are for profit entities..not sure why it's mixed in

with universities.

Universities who invent new drugs will generally patent the drug then license the drug to a pharma/biotech co. in exchange for some combination of an upfront payment and/or royalty on future sales... or a university scientist will start a company backed by venture capital and obtain the license. I would like to know the percentage of approved drugs that originated in university research.

You stated drug co's spend 19X more on marketing than R&D..that is false. You are probably referring to the Huffpo article on a BMJ report that stated "for every dollar pharmaceutical companies spend on basic research, $19 goes toward promotion and marketing". Basic research is molecule discovery/drug screening and pre-clinical animal testing which is only a small portion of drug development costs.

The most money spent by far is on clinical trials. In general it takes about 10 years from pre-clinical animal testing through approval. Some of the trials can last for years and involve tens of thousands of patients. In 2013 the per-patient cost in a Phase III trial was $48,000.. it's probably closer to $70,000 today.

Most drugs fail before they even enter the clinic and when they do get an IND approval..the failure rate entering Phase I is around 90%? And for the 10% that succeed and go on to Phase II the failure rate is 70%.

R&D spending by pharma/biotech as a percentage of sales is one of the highest if not the highest of any industry. Between 1975 and 2009 R&D spending has more than tripled ..from 5% to 17% of sales. But I agree that they spend way too much on marketing.. they spend more on marketing than R&D..but it's surely not 19X.

Here's an excellent article on the relationship of R&D to marketing spending...

How Much Does the Drug Industry Spend on Marketing?

http://blogs.sciencemag.org/pipeline/archives/2009/07/08/how_much_does_the_drug_industry_spend_on_marketing

There’s now a very useful paper in Nature Reviews Drug Discovery looking at just this issue. The authors (from three universities in the US and Israel) are looking into the general question of which is the better use of money: put it into R&D for the long term, or promote existing products for the short term? I should make clear at the outset that those two options do line up in that way. R&D expenditures take years to pay off, if ever, given the amount of time that drug development takes. And marketing of a current product had better start paying off in a shorter time frame, because every patented drug is a wasting asset, constantly being eaten into by competition and by its time to patent expiration.

Since we’re talking about stock prices, which are generally forward-looking, the way to interpret these results is probably that investors expect R&D expenditures to pay off in the long term, but actually expect sales and marketing expenditures to reduce long-term value. If that’s so, then why spend money on marketing? The reason the authors propose is just what I’d been talking about: short-term reliability. Drug discovery and development is inherently risky, and promotion of existing products is (at least comparatively) more of a sure thing. Companies engage in a mix of the two to try to even the cash flow out. (And as the authors note, if executive compensation is tied more to short-term performance, then there’s an incentive to go with the short-term gains).