The myth of Big Pharma funded medical breakthroughs

From Peter Gotzsche´s book “Deadly Medicines and Organized Crime: how big pharma has corrupted health care” Radcliffe Publishing, 2013.

Myth 4: Breakthroughs come from industry-funded research


An often heard argument is that none of our drugs were invented by the former socialist countries east of the Iron Curtain. That proves nothing. There was so much else that didn’t work out in these countries under dictatorship rule. The misconception is huge. Virtually all the basic science that enables modern medicine to move forward takes place in the non-profit sector, at universities, research institutes, and government laboratories.23 A US Congress report from 2000 noted that, ‘Of the 21 most important drugs introduced between 1965 and 1992, 15 were developed using knowledge and techniques from federally funded research.’ Other studies have found the same, e.g. at least 80% of 35 major drugs were based on scientific discoveries made by public-sector research institutions.24 The National Cancer Institute played the lead role in the development of 50 of 58 new cancer drugs approved by the FDA between 1955 and 2001.7


Three of the most important discoveries in the 20th century – penicillin, insulin and the polio vaccine – all came from publicly funded laboratories. The NIH conducted an investigation on the five top-selling drugs in 1995, Zantac (ranitidine, for ulcers), Zovirax (acyclovir, for herpes), Capoten (captopril, for high blood pressure), Vasotec (enalapril, for high blood pressure) and Prozac (fluoxetine, for depression), and found that 16 of the key 17 scientific papers leading to the discovery and development of these drugs came from outside the industry.3


The picture is very consistent. The first breakthrough in AIDS also came from public research and the US government spent double as much on research as all the drug companies taken together.7 The typical story is that drug companies invest relatively little in the real breakthroughs, but when they take over from publicly funded research, they sell the drug at an exorbitant price, as they have a monopoly. In addition, they routinely lie about the research and often steal the credit for the drug and claim they found it themselves.7 The much touted public–private partnerships fall totally apart when the private part constantly runs away with all the money and all the credit, making the rest of society look like a fool or a victim of robbery.


Drug companies spend only 1% of revenues on basic research to discover new molecules, net of taxpayer subsidies, and more than four-fifths of all funds for basic research to discover new drugs and vaccines come from public sources.25


An important reason why most breakthroughs come from publicly funded research is that capitalism and curiousness go very badly together. It takes time to be curious, and senior people in drug companies don’t have the patience. They want a quick return on their investments, which will help them advance to even more lucrative positions in other companies. Managers are therefore likely to shut down a particular line of research if there hasn’t been progress after a couple of years.


Psychologists have shown that money is a poor motivator, in contrast to giving people something meaningful to do, and scientists are radically different from managers. The salary isn’t important. What matters is solving the puzzles and contributing something of importance to the world. As an example, it took more than 20 years for an indefatigable scientist, Eugene Goldwasser, to find and purify the first small vial of human erythropoietin.7



3 Relman AS, Angell M. America’s other drug problem: how the drug industry distorts medicine


and politics. The New Republic. 2002 Dec 16: 27–41.


7 Goozner M. The $800 Million Pill: the truth behind the cost of new drugs. Berkeley: University


of California Press; 2005.


23 Mintzberg H. Patent nonsense: evidence tells of an industry out of social control. CMAJ. 2006;


175: 374.


24 Stevens AJ, Jensen JJ, Wyller K, et al. The role of public- sector research in the discovery of drugs and vaccines. N Engl J Med. 2011; 364: 535–41.


25 Light DW, Lexchin JR. Pharmaceutical research and development: what do we get for all that


money? BMJ. 2012; 344: e4348.