> When six out of seven of you experiments end in failure and the median cost for each failure is $20 million you'd think the process is very rigorous.

That's far from sufficient to consider the approval process rigorous, it's not even necessary. Particle Physics is very rigorous but still they don't fail more than six of seven experiments.

The solution to this paradox is that the reject rate doesn't tell you that much about the quality of the selection process. If at all it may reveal something about our collective ability to formulate correct hypotheses (based on understanding of the subject) for this experimental process.