Source? My casual understanding of American pharmaceutical R&D is the majors drive profits into acquiring successful biotech companies, which in turn drives investment in a thriving biotech industry (which tends to do the early-stage research). This model pushes economic gains to research risk takers and lets the majors focus on marketing and distribution, a decent division of labour.
Actually what kills the field is effective drugs losing exclusivity. While the best-in-class treatments have patent protection R&D investment in the same therapeutic category is less risky than when you have to come up with something much better than the unexpensive generic/biosimilar already available.
1. Patent a drug 2. Make inconsequential changes 3. Patent it again 4. Repeat
I don't have any first hand experience in the industry so I don't know if this is a serious problem. I don't even know if it has a name!
The deeper problem is that we aren't getting newer better drugs. Once a blockbuster like Humira happens, it seems to kill off the field. This is mostly because you need to spend a lot to do a massive trial to show your Humira 2.0 is better, with no guarantee it will actually be better. The economics are very hostile. Pharma tends to do smaller trials with their new drug in more select populations eg those not responding to Humira, and therefore end up having a much smaller market if the drug works.
Drug pricing should be re-engineered to encourage more development rather than the opposite. If better alternatives exist then pharma obviously won't be able to charge extortionate prices.