Drug discovery and development involves several basic steps: choosing a disease target and drug target, identifying a lead compound, optimizing the lead compound's structure through structure-activity relationships, determining toxicity and efficacy in animal models, and carrying out clinical trials in humans. Key parts of the process include identifying the pharmacophore of active compounds, improving pharmacokinetic properties like absorption and metabolism, ensuring safety through toxicity testing, and developing an efficient manufacturing process. Thalidomide highlights the importance of thorough safety testing, as its approval without adequate pregnancy testing led to severe birth defects in thousands of children.