Merck & Co. R&D expenditure 2006-2024

In 2024, Merck & Co. reported R&D expenditures of 17.9 billion U.S. dollars. American pharmaceutical company Merck & Co. increased its research and development (R&D) expenses significantly during the pandemic years 2020-2022 to approximately 13.5 billion U.S. dollars. However, 2023, saw a massive increase up to 30.5 billion dollars, mostly due to higher charges for business development transactions and increased development spending particularly in the therapeutic areas of oncology, cardiovascular, infectious diseases and vaccines. 

Finding a cure for rising research costs

To increase the quality of its innovation, Merck & Co. has entered into arrangements with other companies, and lower payments made to its collaborative partners was one reason for the reduction in R&D costs in 2018. But in the course of the following two years, R&D spending became again increasingly important and reached a record high of 30.5 billion dollars in 2023. In 2024, Merck & Co. had approximately 75,000 employees worldwide, with around one fifth employed in research activities.

How much does the pharma industry spend on research?

Merck & Co. is a member of the trade group PhRMA (Pharmaceutical Research and Manufacturers of America). Members of the group spent a collective 96 billion U.S. dollars on R&D in 2023, with expenditure within the United States accounting for a share of around 75 percent. The pharmaceutical industry is one of the biggest investors in R&D: PhRMA members spent over 21 percent of their consolidated worldwide revenues on R&D in 2023.