The Burrill Report


Global research and development spending is forecast to grow by 3.8 percent to $1.6 trillion in 2014, according to Battelle and R&D Magazine’s annual forecast. After a flat year of R&D spending in 2013, the United States is projected to show modest growth in 2014 while China’s total investment in R&D is expected to continue its upward trajectory and surpass that of the United States by 2022.

Spending on research and development is a primary measure of innovation, fundamental to the growth of economies in today’s world, and an important measure of a country’s competitiveness going forward. The report’s [http://www.rdmag.com/sites/rdmag.com/files/gff-2014-5_7%20875x10_0.pdf] authors say they expect U.S. R&D funding to improve largely due to growth in private sector R&D spending as federal funding has become difficult to forecast because of the breakdown of orderly budget processes.

The U.S. remains the world's largest R&D investor at a globally competitive level of research intensity, according to the Battelle-R&D Funding Forecast, which projects U.S. investments to equal 2.8 percent of the U.S. GDP, about $465 billion across all industries. However, the increase is just 1 percent increase in real dollar terms.

Although there is a bit of uncertainty about federal spending, the report forecasts the U.S. government to fund about $123 billion of R&D in 2014, an increase of 1.5 percent, largely to agencies that focus on basic research like the National Institutes of Health, the National Science Foundation, and the Department of Energy's Office of Science.

In the life sciences industry, the biopharmaceutical sector accounts for 85 percent of all R&D expenditures. Battelle-R&D forecast’s the global to have a healthy recovery after a flat 2013, growing 3.1 percent to $201 billion in 2014. R&D spending in the U.S. life sciences industry is expected to grow a modest 2.2 percent to about $93 million, with growth primarily coming from smaller biopharmaceutical innovators and medical device manufacturers.

Big Pharma continued to top the list of largest R&D spenders. Roche, the top spender in 2012, has seen its R&D spending decline more than 2 percent on average in each of the past two years. R&D spending accounted for greater than 10 percent of sales for these companies, with Eli Lilly’s spend more than 23 percent.













December 13, 2013
http://www.burrillreport.com/article-global_rd_spending_to_grow_3_8_percent_in_2014.html