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Biopharmaceutical Industry Research & Development Tops $55 Billion In 2006February 12, 2007
San Francisco, CA - February 12, 2007
New statistics just released reveal that R&D investments in new medicines by the biopharmaceutical industry was over $55 billion in 2006, according to a combined analysis conducted by Burrill & Company, a San Francisco based global leader in life sciences with principal activities in Venture Capital, Merchant Banking and Media and the Pharmaceutical Research and Manufacturers of America (PhRMA).
“This is the third year that we have joined with the PhRMA to report industry-wide biopharmaceutical research and development expenditures,” said G. Steven Burrill, CEO of Burrill & Company. “The steady growth of R&D investment continues to support important advances in better medicines and new treatments for patients made by research scientists and physicians. The over $55 billion invested in R&D last year represents an almost 8% increase over 2005 industry expenditures.”
PhRMA’s biotechnology and pharmaceutical research member companies reached a record $43 billion in 2006 (up from $39.9 billion in 2005), according to PhRMA's Annual Member Survey. The increased investment in biomedical R&D in 2006 continues 26 years of strong growth in R&D investments by America’s research-based pharmaceutical companies – in 1980 member companies invested $2 billion in R&D. When factored together, the total investments in biotechnology and pharmaceutical R&D by both PhRMA member companies and non-PhRMA members ($12.2 billion) reached a record $55.2 billion in 2006, according to a Burrill & Company analysis for PhRMA.
Burrill & Company routinely reports R&D expenses among other key financial parameters for the universe of U.S. publicly listed biotech companies through its annual report on the industry (sourced from company reports filed with the SEC). To create a comparable report additive to PhRMA’s annual membership survey, Burrill applied a set of pre-determined criteria to their annual biotech report to identify and select non-member companies. Specifically:
- Companies must be based in the United States of America
- Companies must not be a member or member subsidiary of PhRMA and,
- Companies must meet the “human healthcare focus” test, i.e., their R&D expenses are principally for research and development of new medicines for healthcare.
“Increasing medical innovation is the result of biotechnology and pharmaceutical firms working in collaboration with each other and other research institutions to create drugs to alleviate sickness and improve wellness,” added Burrill.
About Burrill & Company
Founded in 1994, Burrill & Company is a San Francisco-based global leader in life sciences with principal activities in Venture Capital, Merchant Banking and Media. The Burrill family of venture capital funds has over $850 million under management The company publishes an annual book on the "State of the Industry" – the 21st Edition, Biotech 2007-Life Sciences: A Global Transformation, will be available in March 2007. In addition, the Burrill Life Sciences Media Group publishes a range of biotechnology/life science newsletters and reports and sponsors and facilitates over a dozen leading industry conferences. Full details may be found at: http://www.burrillandco.com/
The Pharmaceutical Research and Manufacturers of America (PhRMA) represents the country’s leading pharmaceutical research and biotechnology companies, which are devoted to inventing medicines that allow patients to live longer, healthier, and more productive lives. PhRMA companies are leading the way in the search for new cures. PhRMA members alone invested an estimated $43.0 billion in 2006 in discovering and developing new medicines. Industry wide research and investment reached a record $55.2 billion in 2006.
Peter Winter, Editorial Director, Burrill & Company
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