Is that really true? I'm guessing a big part of the cost is figuring out how to actually invent stuff needed for the project. That knowledge is now known. That cost is now 0.
To piggy back on the the GP's point, the fabrication research is only one small cost center. Quality control costs much more in aerospace than many people realize. The reason why a bolt may cost $150 is because it has to be tracked, material coupons kept/tracked/tested, held in bonded storage etc. and not because we had to figure out how to make a bolt. Those costs don't come down as much with scale as, say, raw material.
If it were all about knowledge costs, many designs today would be dramatically cheaper because many use technology (and even refurbished rockets) from 50 years ago.
We're talking about marginal costs, not development costs. So the cost to invent a component is already out of the equation. The high production cost of something like Hubble comes from testing and validation more than materials or fabrication.
The failure modes for something big in space can be extremely dangerous. Even a tiny "cheap" cubesat requires a lot of relatively expensive testing so there's a reasonable assurance it won't fail in some catastrophic fashion and destroy the entire rocket.
Testing space hardware is additionally difficult because you can only just approximate the hardware's operating environment on the ground. Space hardware also can't be easily repaired or repaired at all once launched. So you've got to test actual flight hardware and if it fails possibly rebuild it from scratch testing and validating the entire way.
Developing space hardware and high precision science instruments is expensive and difficult. But it's just a small portion of the overall mission cost for something like Hubble or JWST.
> The testing process would have to be more streamlined or efficient, i would think.
Why do you automatically assume testing for a complicated and delicate machine is inefficient or not streamlined? That's a pretty bold assumption with zero evidence.
Understanding failure modes doesn't help test and validate something any faster. There's a finite number of hours in a day and components need some proscribed amount of testing.