| How the costs of research and its associated risks contribute to a minimum price that would support continued private pharmaceutical investment is unclear.;We employed a linear cost-volume-revenue breakeven analysis to equate initial capital investment and risk, and its associated post-drug-approval revenue. A decision-tree analytic model was utilized to define the relationships between investment events, outcomes, and risk. A systematic review was employed to determine the model inputs.;In oncology, the minimum revenue required to support R&D is ;The minimum required return on investment varies with estimates for cost of capital and the approach a firm uses when developing novel therapeutics. |
