Ever wonder why that little pill in your prescription bottle costs a small fortune? It’s not just corporate greed—developing a new drug is like betting big on a long-shot racehorse. A groundbreaking study published in 2025 peels back the curtain on the odds of getting a new drug from the lab to your local pharmacy, revealing a success rate that’s both fascinating and sobering. Spoiler alert: only about 1 in 7 drug candidates makes it to market. Let’s dive into the high-stakes world of drug development, explore why the odds are so tough, and uncover what this means for patients like you.
The Daunting Journey of a New Drug
Developing a new drug is a marathon, not a sprint. It starts with a promising molecule in a lab, followed by years of testing in clinical trials—Phase I (safety), Phase II (effectiveness), and Phase III (large-scale confirmation). If all goes well, the drug faces a final hurdle: approval by the U.S. Food and Drug Administration (FDA). But the path is riddled with pitfalls—think unexpected side effects, lackluster results, or sky-high costs. According to a 2025 study led by Alexander Schuhmacher, only 14.3% of drug candidates that enter Phase I trials from 2006 to 2022 ultimately win FDA approval. That’s roughly a 1 in 7 chance of success, a figure that explains why drug companies charge premium prices to recoup their massive investments.
This “likelihood of approval” (LoA) isn’t just a number—it’s a critical metric that shapes how companies plan projects and calculate returns. With development costs often soaring past $2 billion per drug, per a 2020 JAMA study, a low LoA means companies are pouring money into candidates that may never see the light of day. For patients, this translates to higher prices for the drugs that do make it, as companies offset the losses from failed attempts.
A Peek Inside the Numbers
Schuhmacher’s team dug into data from clinicaltrials.gov, analyzing 2,092 drug candidates and 19,927 clinical trials across 18 top pharmaceutical companies from 2006 to 2022. The results? Each company juggled an average of 116 drug candidates, running hundreds of trials—460 in Phase I, 303 in Phase II, and 344 in Phase III—to secure just 0.9 FDA approvals per year. That’s a lot of effort for less than one win annually.
But not all companies face the same odds. Giants like Pfizer and Roche each tackled over 230 candidates, while smaller players like Novo Nordisk worked with just 29. The number of trials varied too, with Pfizer and GlaxoSmithKline running over 2,200 each, dwarfing Amgen’s 507. When it came to LoA, the average was 14.3%, but the spread was striking: Amgen (22.8%) and Novo Nordisk (20.7%) outperformed, while AbbVie (8.1%) and GlaxoSmithKline (9.1%) lagged. Why the gap? It often comes down to strategy, focus, and a bit of luck.
Why Some Companies Beat the Odds
The differences in LoA highlight how companies play the drug development game differently. For example, Amgen’s high success rate may stem from its focus on biologics—complex drugs made from living cells—that often target specific diseases like cancer or autoimmune disorders. Novo Nordisk’s edge likely ties to its expertise in diabetes and obesity treatments, where clear biological pathways make trial success more predictable. On the flip side, AbbVie’s lower LoA doesn’t tell the whole story. Its blockbuster drug Humira® racked up nearly $200 billion in sales from 2002 to 2023 by expanding into eight adult and four pediatric indications through “lifecycle management”—tweaking formulations or targeting new conditions to extend a drug’s market life. This strategy can boost profits but may dilute LoA if trials for new uses fail.
Schuhmacher’s study also suggests that focusing solely on the straight path from Phase I to first approval, rather than additional uses or formulations, might inflate LoA estimates compared to older studies (some as low as 7.9%). Factors like disease type matter too—cancer drugs, for instance, often face lower success rates (around 5%, per a 2018 Nature Reviews Drug Discovery study) due to complex biology, while diabetes drugs fare better.
What This Means for You
For patients, the low LoA explains why brand-name drugs carry hefty price tags. Companies spend billions on research, clinical trials, and navigating regulatory hurdles, knowing most candidates will crash and burn. The few that succeed—like Humira® or Novo Nordisk’s Ozempic®—must generate enough revenue to cover those losses. But there’s hope: understanding LoA helps companies make smarter bets, potentially lowering costs in the long run. Plus, advances like AI-driven drug discovery are starting to boost success rates by predicting which molecules are most likely to work.
Your Guide to Navigating Drug Costs:
Ask About Generics: Once a drug’s patent expires (typically 20 years from filing), generics can offer the same benefits at a fraction of the cost. Check with your pharmacist about generic options.
Explore Assistance Programs: Many drug companies, like Pfizer or AbbVie, offer patient assistance programs to reduce costs for uninsured or low-income patients. Visit their websites or ask your doctor.
Talk to Your Doctor: If a medication is too expensive, discuss alternatives with similar effects. For example, older drugs may be cheaper but just as effective for your condition.
Stay Informed: Use resources like GoodRx to compare prices at local pharmacies or find discounts. Apps like SingleCare can also help you save.
The Road Ahead
The 14.3% LoA is a stark reminder of the gamble behind every new drug. Yet, it’s also a call to action. By understanding these odds, companies can refine their strategies, governments can incentivize innovation, and patients can advocate for fairer pricing. For now, the next time you wince at a prescription bill, remember the long, risky road that drug took to reach you—and push for solutions that make life-saving treatments more accessible.
This article is based on Alexander Schuhmacher’s 2025 study on the likelihood of approval for new drugs, supplemented by insights from peer-reviewed research in journals like JAMA and Nature Reviews Drug Discovery to provide a clear, engaging look at a complex topic.
