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A new study sparks a war of words over pharma’s commitment to research | STAT

WASHINGTON — A coalition of the drug industry’s fiercest foes is accusing the world’s top drug makers of hiding behind research and development “as an excuse for price-gouging American patients.” And they’re pointing to a new study that finds drug makers spent about 22% of their revenues on research and development in 2017 to prove their point.

The new study, first shared with STAT, was commissioned by the Campaign for Sustainable Rx Pricing, a coalition that includes pharmacy middlemen, hospitals, and insurers and that advocates for drug pricing reforms. It was based largely on analysis of 2017 Security and Exchange Commission filings for the 10 largest U.S.-based pharmaceutical companies that generate more than half their revenue from prescription drugs. And while the industry average was 22%, Celgene spent the largest percentage of its revenues on research (45.49%) and Gilead spent the lowest (14.3%).

To hear the coalition tell it, the study is proof that the pharmaceutical industry isn’t spending nearly enough of its profits on new cures — despite companies’ repeated insistence that that’s exactly why they price their drugs so high. Jon Conradi, a spokesman for CSRxP, called that line the industry’s “go-to defense.”

“It is really important context that is often not part of the conversation to know not only exactly how much the industry does actually spend on R&D, but what that number looks like in the context of what they spend on everything else — things that have nothing to do with inventing or innovating new cures, or helping patients,” he said.

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A new study sparks a war of words over pharma’s commitment to research.

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