Three trends will shape pharmaceutical R&D in the next millennium. Firstly, companies must improve their R&D performance. The high cost of R&D reflects our one in ten success rate, but genetics, automation and informatics offer the prospect of significant improvement. Secondly, companies and society will continue to focus on value of medicines. Value is a subjective measure of benefit that is causing dilemmas for pharmaceutical companies, governments, physicians and patients. Medicines that do not create value will be failures in an increasingly competitive and rational marketplace. Finally, pharmaceutical companies will wrestle with the knotty issue of social responsibility. Quality and length of life continue to improve for the wealthy, but are actually declining in many impoverished areas of the world. The challenge will be to develop effective partnerships with governments and global health of both rich and poor. This may be the most important challenge we face.