MSD Singapore - Novel Medicine

Novel Medicine

The practice of medicine never stands still. Every new pill brings new hope.The research and development of novel medicine usually takes 10 to 15 years of laboratory work, numerous failures, extensive clinical trials and rigorous regulatory review for safety, at an average cost of US$500 million.

Novel medicines have generally been shown:
• to have fewer side effects
• to have improved drug effectiveness
• to be easier to administer
• to decrease the need for surgery, hospital admissions, or use of emergency rooms, or to shorten hospital stays
• to increase life expectancy

Research-based companies are the engines of innovation. Pharmaceutical innovation must continue. The battle is far from over as the world is still plagued with untreatable diseases.

At MSD, we discover, develop, manufacture and market a broad range of novel health care products that are backed by stringent trials.At MSD, we are committed to bringing out the best in medicine.

Why do medicines cost so much
Why are pharmaceutical costs rising so rapidly
Values from medicines

Why do medicines cost so much

We live in a time of unprecedented progress in pharmaceutical research and development. A partnership among government, academia and industry is producing new and better medicines for the treatment of disease and, increasingly, for the prevention of chronic diseases. MSD alone has introduced 15 new medicines in the past five years for conditions such as high blood pressure, asthma, osteoporosis, arthritis and HIV/AlDS.

This progress does not come without controversy. At the same time this remarkable progress has been made, health care costs have risen and policymakers, health care providers and consumers are asking tough and legitimate questions if the cost of pharmaceuticals could be responsible for the overall increase in the cost of health care. At MSD, we take seriously our duty to respond to these questions directly and forthrightly.


The price of medicines reflects the research and knowledge that prevents and cures disease and relieves suffering.

Just as the price of a textbook is not determined by the cost of the paper of its pages and the price of a computer program is not determined by the cost of a disk's material, the price of a medicine is not based on the cost of its ingredients. The value of medicines, like that of other products that result from research and creativity, is determined by the knowledge they represent knowledge that prevents and cures disease and relieves suffering.

The knowledge needed to discover and develop new medicines does not come cheaply. Discovering, developing, testing and gaining regulatory approval for new medicines is expensive, time consuming and risky. Studies show that it can take nearly 15 years and cost nearly 500 million dollars to bring a new drug to patients.¹ And for every medicine that makes it to patients, many more fail to meet stringent tests of safety and effectiveness.


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In 2004, pharmaceutical research companies invested a record of US$38.8 billion in research and development on medicine. This represents a more than 4½ times the investment in 1990².

In 2004, MSD’s research and development expenses was US$4 billion, an increased of 22% over 2003³. This expense growth reflects the Company’s ongoing commitment to both basic and clinical research.

Why are pharmaceutical costs rising so rapidly


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“Prescription medicine spending should be put in the context of overall health care spending, including the avoided costs of surgery, visits to emergency rooms or lengthy stays in hospitals or nursing homes”⁴

People are using more medicines to prevent and treat disease and improve their quality of life. The average age of people around the world is rising and people are living longer. As we age, we tend to have more conditions that can be treated with medicines. And, regardless of age, people are using more medicines because more treatments are available for more conditions, and patients and physicians are better informed about therapies and more accepting of their use. More people are recognizing the benefits of using medicines on a daily basis to prevent serious conditions, such as coronary heart disease.


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More patients and health care payers are realizing that the appropriate use of medicines may reduce hospitalizations and other expensive and less effective medical interventions.

More new medicines are being introduced. In recent years, there has been an explosion of new scientific knowledge and, therefore, a large number of new and improved medicines, many of which treat conditions that could never before be treated. Other therapies provide improved outcomes and fewer side effects. There are also new ways of discovering drugs that are resulting in more new and more effective medicines. Often, these innovative treatments are introduced at higher prices than the older and often less effective therapies they replace.


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On average, pharmaceutical companies have successfully developed and approved by FDA 33 new medicines a year over the past decade⁵.

Values from Medicines

We believe these are legitimate answers to the questions. However, good answers do not make a difference for those individuals who cannot afford the medicines they need.

For those who pay for coverage among them governments, individuals and employers - the real answer is to demand value from medicines.

Those who pay for medicines must ensure that they are used in an appropriate and cost-effective manner. MSD supports the use of health management programs that ensure that drugs are prescribed and used appropriately, and the appropriate use of generic medicines.

And we support an environment based on competition, which sparks innovation, creating powerful incentives for new, more effective, and more cost-effective medicines and treatments.

At MSD, we take seriously our mission to bring our finest achievement to everyone. We appreciate your taking the time to consider our thoughts and look forward to participating actively not only in the search for cures but in the public debate on expanding access to the fruits of our scientific discoveries.

1. Tufts Center for Study of Drug Development : NCE Database 1999; Meyers & Howe 1997.
2. PhRMA Annual Report 2005-2006 “New Medicines. New Hope”, p12.
3. MSD Annual Report 2004, p.24
4. PhRMA “A Discussion of Tdday's Pharmaceutical Issues”, p.13
5. PhRMA “What goes into the cost of prescription drugs”, p.5

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"How can we bring the best of medicine to each and every person? … We cannot rest until the way has been found, with our help, to bring our finest achievement to everyone."


		George W. Merck 1950

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