Biopharmaceutical companies invest millions of dollars in their clinical pipeline, chasing that one elusive cure that can fetch them manifold returns when the program comes to fruition. Often times, unfazed by setbacks, these companies pursue promising opportunities identified by their R&D team just so that they can wipe years of accumulated losses and turn profits for all stakeholders concerned.

R&D expenses as a percent of total spending vary between 18% and 31% for big pharma companies, according to data from S&P Global Market Intelligence. Apart from R&D spend, there are other metrics that can help gauge how innovative a biopharma company is.

The index, according to IDEA Pharma, takes into account the following criteria:

• The proportion of pipeline to marketed drugs;
• The number of trials investigating novel agents;
• The proportion of 'novel' regulatory designations; and
• Assessment of the companies' R&D investments.

Top 10

Surprisingly, Pfizer Inc.(NYSE:PFE) and Roche Holdings AG Basel ADR (OTC:RHHBY) don't make it to the top 10.

AstraZeneca's Outperformance

The recent quarterly results showed that the company expended about 24% of its total spending on R&D.

"There's a critical distinction between invention and innovation – success is achieved by discovering and developing meaningfully great medicines (invention) and getting those medicines to market, and to patients (innovation). It is wonderful to see a company of AstraZeneca's scale and history able to turn around its fortunes in a relatively short period of time," IDEA Pharma CEO Mike Rea said.