A 505(B)(2) Drug Dev.Cost - Greater than 100 million, less than 600 million? (Ball Park). Explanation: There are some widely different drug development cost averages published. Naturally, there is a great financial incentive to warp those figures higher to justify the astronomical prices of patented pharmaceuticals. These figures are not the average out-of-pocket cost to develop a singular drug. They include the cost of failures in a portfolio of drugs undergoing R&D, opportunity costs, FDA review costs, etc. According to the report below from liaison.com, for a full NDA (New Drug Application or Novel Drug Application) the average total cost is about 2.9 billion, of that 1.7 billion is the out-of pocket cost, 1.2 billion is opportunity cost (it takes about 11 years for a full NDA which is normally figured in the 3% to 7% range/year) and about $312 million in post approval studies. Cost Breakdown For Full NDA Drug Development
A 505(B)(2) can take only 1 to 3 years for approval, and when a clinical trial is needed (not always), they often just need a Phase III trial (no phase I and II). The opportunity cost is a small fraction of a 11 year approval for an NDA. The drug development R&D is also a small fraction. While the article below is concerning distressed generics, I believe it is applicable. 505(B2) Drug Approval Pathway Comparison to NDA
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