Pharmaceutical innovation and the burden of disease in developing and developed countries

Abstract

I perform two analyses of the relationship across diseases between pharmaceutical innovation and the burden of disease in developed and developing countries. Both analyses indicate that the amount of pharmaceutical innovation is positively related to the burden of disease in developed countries but not to the burden of disease in developing countries. The most plausible explanation for the lack of a relationship between the burden of disease in developing countries and the amount of pharmaceutical innovation is that incentives for firms to develop medicines for diseases primarily afflicting people in developing countries have been weak or nonexistent.