Drug development is a long, costly, and high-risk process, particularly in its early stages.[1] It is estimated that 90 percent of drug candidates that advance to Phase I clinical trials will fail before reaching final regulatory approval, for reasons including a lack of clinical efficacy, unmanageable toxicity, poor pharmacokinetic properties, and a lack of market capable of financially supporting product launch.[2]
Funding for basic science provides the foundational knowledge that drives breakthroughs in diagnostics, therapeutics, and preventive care. Early-stage discoveries often lack immediate commercial application, making public support essential to bridge the gap between scientific insight and real-world innovation.[3] Government support can help fill funding gaps and accelerate innovation by expanding programs such as NIH grants, Small Business Innovation Research (SBIR) awards, and public-private partnerships.[4] These initiatives provide essential resources for basic research, early translational science, and proof-of-concept studies. Additionally, investment in shared infrastructure such as advanced manufacturing facilities and clinical trial networks can reduce costs and enable smaller companies to compete in developing breakthrough therapies. Robust federal investment, coupled with significant further financial investment in R&D provided by the private sector, enables the United States to lead globally in the development of a pipeline of transformative ideas that fuel biopharmaceutical progress and advance the future of patient care.[5]
The long-term benefits of sustained research investment extend far beyond the laboratory. Every dollar spent on biomedical research generates significant economic returns through job creation, high-value manufacturing, and global competitiveness. In 2024, every $1 spent by the NIH in research funding generated $2.56 of economic activity, amounting to over 407,000 jobs and $94.58 billion in new economic activity nationwide.[6] Early investment in pharmaceutical R&D delivers also profound health dividends in the form of new treatments that reduce disease burden, extend life expectancy, and improve quality of life. Historical data show that federally funded research has contributed to landmark therapies for cancer, cardiovascular disease, and rare genetic disorders, saving millions of lives while reducing healthcare costs over time.[7] These gains underscore the critical role of public funding in driving both economic growth and societal well-being.
To maintain this trajectory of innovation and American biopharmaceutical leadership, a stable and collaborative partnership between the federal government and innovators is essential. Predictable funding streams enable long-term planning and encourage private-sector investment in complementary research and development.[8] Policies that foster transparency, reward scientific excellence, and support technology transfer ensure that discoveries move efficiently from bench to bedside.
Beyond financial support, regulatory modernization is key to removing barriers that slow progress. Streamlining approval pathways for early-stage trials, expanding adaptive trial frameworks, and increasing acceptance of real-world evidence can reduce unnecessary burdens without compromising safety.[9] By combining targeted financial assistance with regulatory flexibility, policymakers can strengthen America’s leadership in biopharmaceutical innovation.
[1] Sun et al., “Why 90% of clinical drug development fails and how to improve it?” 12:7 Acta Pharm Sin B. 2049 (2022).
[2] Id.
[3] R. Walrath, “As research finding dries up for US science, few alternatives appear,” Chemical & Engineering News (Mar. 31, 2025).
[4] B. Connors et al., “Investor initiatives program: Public-private partnerships to expedite commercialization for NCI-funded small business entrepreneurs,” 14:6 Clin Translat Science 2124 (2021).
[5] D. Schulthess et al., “The relative contributions of NIH and private sector funding to the approval of new biopharmaceuticals,” 57 Therapeutic Innovation & Regulatory Science 160 (2023).
[6] K. Agarwal, “NIH Research Funding Supports Jobs, Fuels the U.S. Economy” Association of American Universities (Mar. 14, 2025).
[7] J. Miller, “A brief history of federal funding for basic science,” Harvard Medicine (Apr. 2025); V. Dzau & K. Yamamoto, “Government-funded health and biomedical research is irreplaceable,” National Academy of Medicine (Aug. 18, 2025).
[8] C. Borges, “Public and Private R&D are Complements – Not Substitutes,” CSIS (Aug. 20, 2025).
[9] S. Niazi, “Advice to the FDA to improve its proposed guidelines to rationalize clinical trials by restricting placebo control, preventing low-powered studies, and disallowing studies where bioavailability is not proven,” 17:11 Pharmaceuticals 1424 (2024).