In 2011, National Institutes of Health (NIH)-funded discoveries contributed $69 billion to the nation’s gross domestic product (GDP) and supported seven million jobs. In 2020 alone, the US biomedical and pharmaceutical private sector generated more than $1.4 trillion in economic output.

From Reece et al. (Health Affairs 2025)

In addition to economic output, private-sector R&D funding significantly outpaces public sector funding.

NIH funding for the 18 FDA-approved therapies totaled $0.670 billion, whereas private sector funding (excluding post-approval funding) totaled $44.3 billion. A logistic regression relating the levels of public and private funding to the probability of FDA approval indicates a positive and significant relationship between private sector funding and the likelihood of FDA approval (p ≤ 0.0004). The relationship between public funding and the likelihood of FDA approval is found to be negative and not statistically significant.

From Schulthess et al. (2022).

Moreover, drug companies have increased R&D investments over the past 4 decades, whereas marketing budgets have shrunk in real terms.

More significantly, the industry’s R&D spending increased from $6.3 billion in 1979 to $61.1 billion in 2018 (both in 2018 dollars), a change of nearly ten times. In contrast to the public perception that drugmakers spend more on advertising than R&D, the industry’s advertising expenses shrunk from 6% of sales in 1979 to less than 3% in 2018.

From Jiang et al. (2021)