A big part of the cost is the litigation insurance. Most countries don’t have a horde of slip and fall lawyers just waiting to get class actions rolling.
You have probably hit on the greatest indirect cost of drug research and development. The research does go on, at laboratories large and small, but only the biggest pharmaceutical firms have the necessary capital and incentive to proceed with the long-term testing demanded by both the FDA and by pressures for protection against litigation or harassment lawsuits by a special category of ambulance-chasers. Thousands of “orphan” drugs languish because of high restrictions on applications for study, or because of threatened or actual lawsuits, resulting in preemptive withdrawal from marketing.