[rwmj]

Sure, but Pharma A is full of career managers who never kill drugs under development and Upstart B relentlessly culls drugs that don't work early on. Upstart B's failure rate at the final stages is under 50% so they develop 5 times as many drugs, beating the existing company, and indeed all other drug companies.

Since this isn't happening, it seems this might not be the explanation.

[ozim]

For me it seems this simplification falls flat right away when you take into account budget constraints.

It is not software development where you can start a project every month see how it goes and drop it or pivot.

I guess they use a lot of computer aided models before they even start serious parts but I believe this discussion is not about failure rates on that stage because then it would be 99%