U.S. spending on cancer drugs generates substantial revenue for pharmaceutical and biotech firms. How might pharmaceutical and biotech firms respond if prices in the U.S. fell by 47.4%? Keep in mind that it is estimated that pharmaceutical and biotech firms spend an average of $2.6 billion to get one drug approved (as we will discuss later in the course). This expense can be recouped more easily when these firms receive high prices because the U.S. represents almost one-half of the world prescription drug market in terms of revenue.