Here’s how America’s biopharmaceutical companies lead the way in development of innovative new medicines

Biopharmaceutical companies conduct the most complex and difficult research in the world to develop innovative treatments for patients.

Andrew PowalenyJuly 25, 2018

Here’s how America’s biopharmaceutical companies lead the way in development of innovative new medicines.

In today’s new era of medicine, America’s biopharmaceutical companies are conducting some of the most complex and difficult research in the world to develop innovative treatments for patients.A recent report by the Analysis Group, “The Biopharmaceutical Pipeline: Innovative Therapies in Clinical Development,” examined the drug development pipeline and identified several exciting new areas of scientific opportunity:

  • 74 percent of medicines in the clinical phase are potentially first-in-class medicines, meaning they represent a possible new pharmacological class for treating a medical condition.
  • A range of novel scientific approaches are being pursued to treat a range of diseases and conditions, including 731 projects using cell and gene therapies; 173 projects developing DNA and RNA therapeutics; and 188 projects using conjugated monoclonal antibodies.

This vibrant pipeline is due in part to the biomedical research ecosystem that is among our country’s greatest assets. Government research lays the groundwork for basic understanding of disease and advances in all aspects of health care, including drug development. Meanwhile, biopharmaceutical companies are largely responsible for developing new medicines. The public and private sectors play complementary roles with government having a largely indirect role in medicine development.

In addition to shouldering most of the development load, the biopharmaceutical industry greatly outspends government and academia when it comes to investment in R&D. According to most recent data, in 2016 alone, the biopharmaceutical industry’s investment in R&D reached an estimated $89.8 billion, which almost triples the National Institutes of Health (NIH) total budget of $30.5 billion in 2016, only part of which goes to research related to drug development. 


In cases where federally-funded research results in a patentable invention that has potential to develop into a therapeutic treatment, laws have been in place since 1980 allowing those institutions conducting the federally-funded research to retain title to the patents covering these inventions. This enables these research institutions to license the patents to private sector partners, including biopharmaceutical companies, who then work to develop these inventions into promising treatments or cures. This can lead to royalties for the research institution once commercialization is achieved.[1]

The collaborative ecosystem that exists in the United States between the government, academia and the biopharmaceutical industry is one of our country’s greatest strengths in moving medical advances forward and is a critical factor in ensuring the United States remains the global leader in biopharmaceutical innovation.

America’s biopharmaceutical companies will continue to work with its partners in government and academia to develop innovative, lifesaving medicines that help patients live longer, healthier lives. To learn more about the process behind bringing new treatments to patients, visit

[1] The passage of the Bayh-Dole Act in 1980, allowed universities and other federal grantees to retain ownership of patented inventions and explicitly encouraged cooperation between the public and private sectors. The same year Congress passed the Stevenson-Wydler Technology Innovation Act (later amended by the Federal Technology Transfer Act of 1986), designed to facilitate transfer of technologies developed in the federal laboratory system. The government still receives royalties for commercialization associated with patents it holds but universities, private companies and others also have incentives to translate basic research into medical advances.

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