Data from in vitro plasma protein binding experiments that determine the fraction of protein-bound drug are frequently used in drug discovery to guide structure design and to prioritize compounds for in vivo studies. However, we consider that these practices are usually misleading, because in vivo efficacy is determined by the free (unbound) drug concentration surrounding the therapeutic target, not by the free drug fraction. These practices yield no enhancement of the in vivo free drug concentration. So, decisions based on free drug fraction could result in the wrong compounds being advanced through drug discovery programmes. This Perspective provides guidance on the application of plasma protein binding information in drug discovery.