The top 50 pharmaceutical companies by prescription sales in 2018 - and their research and development (R&D) spending - included big name companies such as Pfizer, Novartis, and Merck &Co. During that year, Pfizer's Rx sales were approximately 45.3 billion dollars. Thus, in that year Pfizer was the largest pharmaceutical company based on pure pharma revenue worldwide. The top pharmaceutical company based on R&D spending at that time was Swiss pharma giant Roche. Roche spent 9.8 billion U.S. dollars on R&D in that year.

Pharmaceutical R&D spending

Research and development in the pharmaceutical industry involves the identification and development of compounds used to make new drugs. The pharmaceutical industry has the largest percentage of spending attributable to R&D among all industries. Research and development spending in the pharmaceutical industry around the world is increasing over time. However, there have been variations in the growth of research and development spending with a significant decline in 2012 and an increase in 2016.

New pharmaceutical products

The goal of R&D is to produce new drugs and compounds. Globally, the U.S. pharmaceutical industry created the largest number of new drugs and compounds between 2013 and 2017, followed by Europe. Among U.S. pharmaceutical companies, there are various levels of success for new drugs depending on the phase of development. The data shows that between phase I and II alone, already over one third of all drugs are failing. Overall, the probability that a new drug makes it from phase I to approval is less than 10 percent.