We frequently hear that the pharmaceutical companies must pour roughly $1 billion into research and development for each new drug they put on the market. But drug companies are not the only big spenders on R&D. Many other industries pour in large sums. Last month, Samsung Electronics, for example, announced it would invest $33 billion by 2012 to build nine new chip lines. And that’s just one company.
But it’s not all that unusual, really. The Technology Review R&D Scorecard says that worldwide corporate spending on research and development is growing, led by the biotechnology and semiconductors sectors.
At the company level, giants such as Microsoft (67 percent), General Motors (14 percent) and Intel (10 percent) had some of the larger increases in their R&D investment last year.
Even China is heavy into funding R&D. Within five years it will be investing a higher proportion of its economy into research and development than the European Union, which is expected to pour 2.2 percent of its economy into R&D by 2010.
Maybe by then China will be a little more serious about protecting intellectual property. But the recent response from the international community to the possible (but unlikely) pandemic of bird flu isn’t encouraging. There is a growing chorus for compulsory licensing Roche’s Tamiflu.
Would such a development undermine the R&D growth going on among some drug companies? If so, it could undercut thousands of new, high-paying jobs, Sanofi Aventis R&D spending has grown 466 percent, and Biogen 195 percent. Will they continue that growth in R&D if countries steal their patents?
Few industries are as demonized as the drug business. It seems that pharmaceutical companies are constantly fighting for their intellectual-property lives.
Political figures and activists spouting populist messages object to the amounts of money drug companies earn providing lifesaving and health-sustaining products. They want the companies to keep pumping out R&D, but once that is finished, all they want is the recipe – the intellectual property behind the drugs – so the medication can be copied and made elsewhere leaving the companies without resources to create the next “miracle drug.”