Where in the world are drugs invented? Measuring pharmaceutical globalization.

The global locations of drug invention are important for public health, economic development, and national security reasons. Inventors tend to focus on diseases endemic to where they live. This is one of the problems of neglected diseases — there are few/no researchers working on certain diseases, which can lead to significant public health problems. Drugs are also excellent exports — fetching high prices and being relatively inexpensive to ship — so they can generate foreign currency enabling global trade. The individuals and companies involved in drug development tend to have high wages and revenues, building tax bases. Finally, weak innovative capacity can lead a country to be dependent on others to deliver medicines for domestic needs (see point #1 above) and to resolve health crises.

So, we know that much of drug development, such as medicinal chemistry, compounding, and clinical trials have spread overseas. We also know that much of manufacturing has spread to low wage-cost countries. The remaining question is: Where are drugs invented?

Using a methodology in introduced in my previous publication on the topic, I examined the locations of inventors listed on drug patents from 2000 through 2010 (source: DrugPatentWatch.com). The results are presented below:

1: The US is the global leader in drug inventorship, but is slipping

The top figure shows the relative contribution of each region’s inventors to the set of patents on drugs approved in each year. The data are all normalized, so you can see relative trends in each country’s contribution. The bottom figure below shows the same data, using lines to make it easier to  observe the trends. What is clear is that the US dominance is decreasing and Europe’s representation appears to be rising. The region of East and South Asia appears to be sporadically increasing its representation with it’s activity being mirrored by corresponding decreases in relative European inventorship.

2: Who is gaining?

With US relative inventorship dropping, and European inventorship showing volatility around a relatively flat trend, it is important to ask the question: Who is gaining inventorship as the US drops? One might assume that one or both of the emerging economies China and India are responsible for the increase in Asian drug inventorship, but the data do not support this assertion. The figure above shows the top ten countries where drugs were invented from 2000 through 2010 — China and India are not on the list. Rather, it is pharmaceutical veteran Japan, which has the third most inventors, that is responsible for Asia’s increase. What’s more, the top ten countries is largely comprised of the legacy pharmaceutical countries. That data show that there is no significant migration of pharmaceutical invention from the legacy pharma countries.

This metric represents a useful tool with which to monitor globalization of pharmaceutical innovation. There are two interesting observations that merit further examination. 1) Is there a correlation between the mild US decline and the growth of Japan? 2) Is there a correlation between the spikes in Japan’s relative inventorship and Europe’s sharp dips?

You can also get more detailed information on the complete set of drug inventors and where they live in my Global Drug Patent Inventor Report and Individual Country Drug Patent Inventor Reports.

What do you think of the findings? Are you surprised? Do you disagree? Sound off in the comments.

Originally posted: biotechblog

3 Responses to Where in the world are drugs invented? Measuring pharmaceutical globalization.

  1. Matt Beers March 6, 2013 at 5:32 am #

    I am a student studying the effects of universal healthcare. I was pro healthcare, but as I am researching, I’m seeing this trend of pharmaceutical invention decline in places that institute a government paid healthcare plan. Needless to say, I am starting to change my mind on the topic.

    I’m Starting to feel that entrepreneurial pharmaceutical invention declines when the government takes over because of the money it costs to research. The entrepreneur does not want to take the risk and do the hard work for the government to use all the benefits, even if the invention could help millions of sufferers.

    With the healthcare movement on the rise, it doesn’t surprise me to see the US lead in pharmaceutical invention start to slip with no other country filling the lost ground.

    It actually makes me a bit sad. These questions race through my mind as I read more and more articles like this:
    Is the slowing of pharmaceutical invention going to stop slowing?
    Are we going to reach a new age where pharmaceutical invention and industry were a thing of the past?
    Is this trend worth being able to visit the doctor’s office at no cost?
    When am I going to visit the doctor for free with an illness in which there is no treatment for?

    That list of questions in my mind go on and on. I could go on, but I have an essay to write. (Probably should use some of my points here in the essay)

    Thank you for this very useful article Dr. Friedman.

  2. GladysRIVERA22 July 26, 2013 at 5:56 pm #

    Set your own life time more easy take the home loans and everything you need.

  3. Anne Furman October 20, 2013 at 7:24 am #

    From 2009 – http://news.stanford.edu/pr/2009/pr-light-pharma-study-082109.html

    US drug corporations spend 2.5 times more on marketing than they do on research. Marketing to sell doctors and the public on “me too” clones of drugs which often are nearing the stage of becoming generic. This keeps the profit up for US drug corporations as the expense of the buying public, Medicare, and the VA.

    The EU is inventing more new, as in address a problem not met, than the US.