2001-2006, R&D expenditure showed 6% growth annually APRIL 2007 SOURCE: CMR INTERNATIONAL PERFORMANCE METRICS PROGRAM © THOMSON REUTERS Your use of these materials is subject to the terms and conditions hereof. Please read the disclaimer carefully before using these materials.

2001-2006, R&D expenditure showed 6% growth annually Chapter 1 Overview Figure 1.2 2001-2006, R&D expenditure showed 6% growth annually Key message In 2006, global pharmaceutical R&D expenditure on ethical pharmaceuticals exceeded US$ 60 billion. Since 1996, global R&D expenditure has grown by over 70%. Methodology Each estimate of annual global R&D expenditure is based on data supplied directly to CMR International from leading pharmaceutical companies in conjunction with data from a number of national pharmaceutical trade associations. Unlike many other published estimates of global R&D expenditure, effort is made to ensure that only expenditure relating to ethical pharmaceuticals is captured. Key Definitions Total R&D expenditure: This includes salaries and all other personnel-related expenditure, expenditure related to consumable materials and supplies, and an appropriate share of overheads to cover administration, depreciation/amortisation, space charges, rent, etc. The expenditure on R&D conducted by means of grants or contracts to other companies or institutions, and proportional expenditure for joint ventures should be included. This definition excludes capital R&D expenditure. Ethical pharmaceuticals: Any chemical entity, biological product, biotech entity or gene therapy product or in vivo diagnostic which is intended for the cure, alleviation, treatment, prevention or diagnosis of disease of humans and is, or will be, available as a prescription only medicine. CMR International Performance Metrics Programme / Source Industry R&D Investment Programme Year SOURCE: CMR INTERNATIONAL PERFORMANCE METRICS PROGRAM © THOMSON REUTERS

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