Why drug development costs a billion dollars
Computer chips have become dramatically cheaper over time. But the opposite seems to have happened in drug development. Since at least the 1950s, it’s become more and more expensive to develop new drugs. Scientists have coined this trend Eroom’s law.
In this episode, Jacob and Saloni investigate Eroom’s law. Why has it become so much more expensive to develop new drugs, despite massive technological advances? They chat about penicillin, CRISPR, billion-dollar research failures, and whether the last decade has been a turning point. Can AI help reverse the trend? Listen to find out!
Chapters:
Chapters:
- (00:00) - Introduction
- (02:53) - Eroom’s law trivia
- (12:33) - How much does it really cost to develop a drug?
- (22:35) - The better than the Beatles problem
- (33:06) - From penicillin to modern clinical trials
- (42:01) - Have we picked the low-hanging fruit?
- (01:01:22) - Is Eroom’s law slowing down?
- (01:06:18) - Can AI reverse Eroom’s law?
- (01:15:09) - Conclusion
You can listen on Spotify, Apple Music, YouTube (https://youtu.be/aJ8girWzWJM), or wherever you get your podcasts.
Hard Drugs is a podcast from Works in Progress about medical innovation presented by Saloni Dattani and Jacob Trefethen. Saloni Dattani is an editor at Works in Progress, a writer on global health and medical innovation, and an advisor to Coefficient Giving on clinical trial reform. Jacob Trefethen is the head of Life Sciences & Curing Diseases at the OpenAI Foundation.
Saloni’s substack newsletter: https://www.scientificdiscovery.dev/
Jacob’s blog: https://blog.jacobtrefethen.com/
Acknowledgements:
- Graham Bessellieu, video editor
- Abhishaike Mahajan, cover art
- Atalanta Arden-Miller, art direction
- David Hackett, composer
Articles
- Jack W. Scannell, Alex Blanckley, Helen Boldon and Brian Warrington (2012). Diagnosing the decline in pharmaceutical R&D efficiency. https://www.nature.com/articles/nrd3681
- Henry Grabowski, John Vernon and Lacy Glenn Thomas (1978). Estimating the effects of regulation on innovation: an international comparative analysis of the pharmaceutical industry. https://dukespace.lib.duke.edu/items/033ea8c0-a9bb-406d-bf85-5688c23c0f1f
- Stephanie Rennane, Lawrence Baker, and Andrew Mulcahy (2021). Estimating the Cost of Industry Investment in Drug Research and Development: A Review of Methods and Results. https://journals.sagepub.com/doi/10.1177/00469580211059731
- Michael S. Ringel, Jack W. Scannell, Mathias Baedeker and Ulrik Schulze (2020). Breaking Eroom’s Law. https://www.nature.com/articles/d41573-020-00059-3
Books
- Paul Offit (2007). Vaccinated: One Man’s Quest to Defeat the World’s Deadliest Diseases.
