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Member Research & Reports

Member Research & Reports

Johns Hopkins: Cost of Clinical Trials for New Drug FDA Approval Are a Fraction of Total Tab

Clinical trials that support U.S. Food and Drug Administration (FDA) approvals of new drugs have a median cost of $19 million, according to a new study by a team including researchers from Johns Hopkins Bloomberg School of Public Health.

The study, published Sept. 24 in JAMA Internal Medicine, is the most comprehensive analysis of key drug trial costs to date, and suggests that these costs contribute only modestly to the overall costs of developing new drugs.

The $19 million median figure represents less than one percent of the average total cost of developing a new drug, which in recent years has been estimated at between $2 to $3 billion.

“The cost of generating this fundamental scientific information is surprisingly low given the total cost of drug development and the high price tags on many drugs,” says study senior author Dr. G. Caleb Alexander, associate professor of epidemiology and medicine at the Bloomberg School.

Pharmaceutical companies in the U.S. routinely explain the high prices they set for drugs by citing the high costs of drug development, including the costs of the “pivotal” clinical trials that are the basis for FDA approvals of new drugs. However, few studies have objectively analyzed these costs.

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