Bringing new medical devices & drugs to market
Innovation has its price. Here are facts and figures around the cost of bringing new medical devices and drugs to the marketplace.
Devices
R&D spending in healthcare
$180 billion+ in 2020 vs. $86 billion in 2005
Source: PwC, The Global Innovation 1000 study
Average cost to bring a medical device from concept to market
$31 million via 510(k) pathway with $2 million to $5 million of this total on development & engineering
$24 million spent on FDA-related charges
$94 million via PMA pathway
Applications submitted to the FDA each year:
4,000 via 510(k) apps
<100 via PMA apps
The majority of medical devices are cleared through 510(k) vs. the PMA pathway.
Source: MassDevice.com
Medications
Cost to develop a new prescription medicine that gains market approval $2.6 billion
Approval rate for drugs entering clinical development <12%
Source: Tufts Center for the Study of Drug Development
In 2019, the pharmaceutical industry spent $83 billion on R&D. Adjusted for inflation, that amount is about 10 times what the industry spent per year in the 1980s. Between 2010 and 2019, the number of new drugs approved for sale increased by 60% compared with the previous decade, with a peak of 59 new drugs approved in 2018.
Source: Congressional Budget Office
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