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The top 50 pharmaceutical companies by prescription sales in 2024 – and their research and development (R&D) spending – included big names such as Johnson & Johnson, Novartis, and AbbVie. During that year, Johnson & Johnson's Rx sales were approximately **** billion U.S. dollars. Thus, the American pharma giant was both the largest pharmaceutical company based on pure pharma revenue worldwide and the second ranked pharmaceutical company based on R&D spending. Johnson & Johnson spent over ** billion U.S. dollars on R&D in that year.

Pharmaceutical R&D spending

Research and development in the pharmaceutical industry involves the identification and development of compounds used to make new drugs. The pharmaceutical industry has the largest percentage of spending attributable to R&D among all industries. Research and development spending in the pharmaceutical industry around the world is increasing over time. However, there have been variations in the growth of research and development spending with a peak during the pandemic years 2020 and 2021.

New pharmaceutical products

The goal of R&D is to produce new drugs and compounds. Globally, the U.S. pharmaceutical industry created the largest number of new drugs and compounds between 2019 and 2023, followed by Europe. Among U.S. pharmaceutical companies, there are various levels of success for new drugs, depending on the phase of development. The data shows that between phase I and II alone, already over half of all drugs are failing.