Novartis, Pfizer and Bristol-Myers hit the gas on R&D last year

Three of the world's largest drugmakers dialed up their R&D budgets in 2014, as Novartis ($NVS), Pfizer ($PFE) and Bristol-Myers Squibb ($BMY) spent big on costly late-stage programs with hopes of delivering blockbuster new treatments in the coming year.

Novartis CEO Joe Jimenez

Novartis, second only to Roche ($RHHBY) among Big Pharma research spenders, upped its R&D budget by about 1% to $9.9 billion in 2014, bankrolling Phase III trials for the cardio treatment LCZ696, the cancer drug CTL019 and the anti-inflammatory antibody secukinumab, recently approved as Cosentyx. In the second half of the year, the Swiss giant is expecting FDA decisions on the cancer therapy LDE225, the COPD combo of QVA149 and NVA237, and LCZ696, which CEO Joe Jimenez has labeled a "multiblockbuster" in the making.

As for Pfizer, a company known for making deep cuts to its R&D budget, 2014 was a bumper year for research spending. The drugmaker poured $7.2 billion into R&D, 9% more than in 2013. Much of that went to the development of palbociclib, a breast cancer treatment for which Pfizer hopes to win early approval this year, and bococizumab, a late-stage PCSK9-blocking cholesterol drug that trails leading offerings from partners Sanofi ($SNY) and Regeneron ($REGN) and standalone Amgen ($AMGN) in a blockbuster race.

Now, in an effort to keep pace with its further-along rivals in oncology and diabetes, Pfizer expects to spend between $6.9 billion and $7.4 billion on R&D in 2015, a figure that might not sit well with investors discouraged by the company's downsized revenue forecast. In tandem, Pfizer is sitting on about $33 billion in cash that many believe will go toward a major, pipeline-building acquisition.

And Bristol-Myers, in the midst of an all-out blitz to develop a new cancer immunotherapy, increased its R&D budget by a whopping 21% last year, spending $4.5 billion on research. That helped the company pick up its first approvals for Opdivo, considered the most promising among a new class of cancer treatments, and Bristol-Myers is working through an ambitious effort to test the antibody against a slew of tumor types and in combination with various oncology drugs.

At the same time, Bristol-Myers has refocused its plans in hepatitis C, ditching its efforts to get a two-drug combo approved in the U.S. and instead focusing on a three-agent cocktail the company believes could chart faster cures than leading offerings from Gilead Sciences ($GILD) and AbbVie ($ABBV). 

- read the Novartis results (PDF)
- here's Pfizer's release
- and Bristol-Myers' statement

Special Report: The top R&D spenders in biopharma in 2013

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