How are clinical trials funded in the US?
Clinical trials are incredibly important when bringing certain products to market. They are an essential step and for most people, it’s not something you ever need to worry about or contend with unless you take part in a clinical trial. Clinical trials can be done on new drugs, treatments, devices and procedures and the whole point is to test the safety and efficacy of the product. But have you ever stopped and wondered how these clinical trials are funded? Who’s paying for these often expensive trials? Let’s take a deeper look at how clinical trials are funded in the US.
What’s the average cost of clinical trials?
Before you start to look into who funds clinical trials in the US it can be interesting to learn the cost. There are three phases of clinical trials, each phase gets more advanced and includes more subjects. That also means the cost rises with each stage. Generally speaking, phase one costs approximately $4 million, phase two is approximately $13 million and then phase three is approximately $20 million. This is on top of all the other costs related to bringing a medication, treatment or therapeutic device to the market.
Any way you look at it, the cost of clinical trials is high and it’s no wonder that so many researchers and companies don’t manage to take products to completion due to monetary constraints.
There isn’t usually a singular source of funds
It would be great to say that funding came from one source but that’s rarely the case. More often than not, there are a lot of parties involved in the funding at various stages of the process. Funding can come from private investors, universities, charities, research institutions, and government, and also from the pharmaceutical company itself, which is looking to expand its offerings.
Big pharma is often the most common stakeholder in a product working its way through the pipeline, as then they own the intellectual rights to the property. Should the product be successful and eventually be offered to the public – there are huge profits to be made, especially if it’s a first of its kind.
Funding comes at different stages
There also tend to be different bodies/investors at different stages. For example, the early stages and clinical trials tend to draw the majority of their funding from the government, which is defined by research councils and the like. It’s meant to give researchers resources to pursue potential treatments and cures.
There is also the pre-clinical stage
Let’s not forget, before a product/drug can even get to the clinical trial stage it needs to go through the drug development and pre-clinical research stage. Some companies offer the services needed to advance the research and licenses for the research, as well as technology such as piggyBac Transposon for gene editing.
An expensive endeavour no matter how you look at it
Bringing a drug, treatment or therapeutic device to market is not a cheap undertaking. All in all, from start to finish, data suggests that it costs anywhere from $314 million to $2.8 billion to take a product from development and research and clinical studies to the market. This is why so many different sources of funding are needed.