New Membership Criteria, R&D Requirements Cut 22 Companies From PhRMA Roster

PhRMA unveiled new criteria for membership, setting higher R&D requirements — and eliminating its associate member level entirely, which included 15 pharmaceutical companies.

To qualify as members, companies must spend a three-year average of $200 million annually on research worldwide and their research spending must equal at least 10 percent of global sales over the same period. Seven full members failed to meet those levels.

The PhRMA board spent three months reviewing membership criteria, during a time of increasing scrutiny over the industry’s pricing policies.

PhRMA said companies may reapply if they meet the new criteria, which take effect immediately. On average, members spend about 20 percent of their revenue on R&D.