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Contrary to popular belief, drug R&D spending is not going down. It's also not rising very quickly--but it is headed up.

In a new report, Evaluate Pharma estimates that the total R&D budget for drug development will hit $149 billion by 2018, with a compound annual growth rate of 1.4% between 2012 and 2018. And Novartis ($NVS) will be in the number one spot for R&D spending, laying out slightly more than $10 billion for research work. Among the top 20 players, Novo Nordisk ($NVO) is expected to boost its R&D budget the most, with an estimated increase of 8%.

That fits neatly with the numbers we've been watching at FierceBiotech in recent years, as most Big Pharma operations try to rein in spending without cutting back.

Evaluate also bluntly assesses the $1.1 trillion spent on R&D in the past decade. "With hindsight this appears to be an inefficient use of this surplus cash," writes Evaluate. "It is often said there is an R&D productivity issue, but is it just poor portfolio strategy and poor investment choices?" And given their track record, Evaluate adds, some companies like AstraZeneca ($AZN) raise the question of whether they should do R&D at all.

That's one of a number of projections that's likely to grab your eye. The headlines also include Evaluate's pick as the most valuable drug in development: Gilead's ($GILD) sofosbuvir for hepatitis C, valued at $17.6 billion with sales of $5.4 billion in 2018. And Gilead will need all of that to justify its $11 billion Pharmasset buyout.

Anticoagulants will be the fastest-growing therapy category on the sales side. And by 2018 more than half of the 100 top-selling therapies will be biologics, with Humira in the number one spot.

Among all the analysts, Evaluate has one of the best records when it comes to tracking the numbers in biopharma. And its projections are nothing to scoff at. So Big Pharma should also take heart in Evaluate's projection on drug sales, noting that after the figure dropped a bit last year, the numbers will start to rise again this year as pharma grapples with the consequences of the patent cliff.

- here's Evaluate's executive summary
http://www.evaluategroup.com/PDFs%20...ve-Summary.pdf
Special Reports: The Biggest R&D Spenders in Biotech | Which Big Biotechs are hitting the gas pedal on R&D spending?

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Read more: What's the most valuable drug in the global pipeline? - FierceBiotech http://www.fiercebiotech.com/story/w...#ixzz2XuSfuaTy
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