Therefore, protection of patents is one of the key conditions necessary for further development of the pharmaceutical industry. At the same time, non-efficient legislation that does not provide the necessary level of patent protection is one of the factors that hamper expansion of “Big Pharmaceutical” companies to the developing countries8.
U.S. based companies hold rights to most of the world’s rights on new medicines and holds thousands of new products currently being developed. As of 2012, the industry helps support almost 3.4 million jobs in the U.S. economy. It is also one of the most heavily R&D based industries in the world. In the United States, the environment for pharmaceuticals is much friendlier than other countries around the world in terms of pricing ability and regulations. Both the Pharmaceutical and Biotechnology industries have experienced significant growth in the past year with year-over-year increases of 13.02% and 34.69% respectively. It is an even more striking when looking at the past five years considering both have beat out the S&P 500 with pharmaceuticals increasing an additional 31.44% and the biotechnology sector besting an astonishing 269.3% more return than the
The high prices set by pharmaceutical companies for drugs allows the companies to continue researching, developing, and producing new drugs. As new diseases are discovered, new medications must be discovered in order to treat them.
Five of the top ten pharmaceutical companies are located in the United States and the other five are European companies, all of these companies combined, employ approximately 787,000 people. The ranking of the following pharmaceutical companies are based on
Even though the pharmaceutical industry had been highly profitable and contributed about 40% OF Ciba-Geigy’s revenues in profit, there were some trends, which were worrying. The government had attempted to reduce a cost of healthcare thus; pressure to lower costs was mounting on industrialized countries. There were restrictions to introduce new products, and price control became stricter while limiting the freedom of doctors to prescribe medications. Patent controls were becoming reduced, and the pharmaceutical industry was becoming increasingly criticized. These trends later made the industry to
The pharmaceutical industry continues to be a major driver of trend. While demand for medicine rapidly increases in emerging economies, a growing number of consumers are also analyzing the economic performance of different medicines. These events will heighten the challenges the
Further more, with other benefits such as low costs in research and development, strong clinical research capabilities, and low sovereign risk, Australia is advancing as one of the most prominent players in the pharmaceutical industry (Productivity Commission 2003). Australia’s population represents 0.3% of the world’s population and consumes around 1% of the total global pharmaceutical sales. The industry generated a total revenue of $6.1 billion in the year 2002 (ALRC 2014).
Nicholas Capaldi (2003) addresses another issue within the pharmaceutical industry, stating that it is caught up in a “perfect storm.” He also mentions how there are a various of interest groups that have conspired to present this industry as profiteers who “……(a) spend obscene sums on marketing1 instead of research, (b) engage in differential pricing at home and abroad in an effort to gouge the American consumer, and (c) deprive developing countries of life-saving medicines” (2003). Because of the high costs of medications, as a result, this is forcing the pharmaceutical industry to make medications more affordable to consumers.
Merck & Co. Inc. is one of the world’s largest pharmaceutical companies in the world for producers of prescription drugs. Merck had sales of 1.98 billion and net income of 307 million in 1978 and continues to steadily rise. Merck invested hundreds of millions of dollars each year in research and allocate the funds amongst various projects. On average it would take approximately 12 years and 200 million dollars to bring a new drug into the market. Many potential drugs offered little chance of financial returns, as some diseases were so rare that treatment could never be priced high enough for the company to recoup the investment. Congress sought to encourage drug companies to
Who loves to drink medicine all the times? Many people would want to hate drug companies because those drug companies can insanely make profit off of expensive medicine that people cannot live without today. Big pharmaceutical is a vast bunch of business companies that are motivated to basically make money and product. Majority of this business of drugs and medical devices are manufactured by bringing billions of profits where it leaves their consumers with harmful side effects such as health suffering experiences (Big Pharma Manufacturers, 2016, p.1). Big pharmaceutical is just a well-known influence over the prescriptions drug and medical device markets all around the nation; even in the United State, the industry gives numerous “annual budget of the U.S. Food and Drug Administration (FDA) (Big Pharma Manufacturers, 2016, p.1).” Also, the industry wants to show its power within the political and social great impacts upon the “nation’s governments and agencies, its health care systems, its doctors and hospitals, as well as the psyche of the American people (Big Pharma Manufacturers, 2016, p.1).” To tackle this issue, around 1900’s, there were great medical solutions to many illnesses, whereas the big pharmaceutical market became so global in today’s economy (Big Pharma Manufacturers, 2016, p.1).
This paper will explore how recent pharmaceutical developments and policy changes have created one significant barrier to cure: high price and cost.
First off, Big Pharma has a huge influence over the medical world and this has proved harmful to this industry for many reasons. Big Pharma companies have bought their way into the world of regularly used medications despite all the baggage they carry. Even with using many forms of bribery, “the $310 billion pharmaceutical industry quietly buys something far more influential” than anything they have to offer to the physicians they work with, and that is “the contents of medical journals and, all too often, the trajectory of medical research itself” (Washington 1). By buying their way into medical journals, these pharmaceutical companies buy the ability to advertise their products to thousands of physicians, even if these products have never been properly tested. This can be very misleading when a product, which may be very ineffective or even dangerous, is advertised in a very credible medical journal solely because the journal is heavily dependent on the profits attained from advertising for the company. In a 1992, for example, editors from the medical journal Annals of Internal
Economic: Globalization of the pharmaceutical industry is an exciting opportunity to have research and development done at cheaper prices in other countries. However, this could be a double edged sword for companies because it is easy for other countries, such as India, to produce generic versions of the drug in bulk.
Within the last ten years a new topic has been on the discussion board. The topic, biosimilar drugs. Biosimilar drugs are drugs that are similar to biologics, but does not have the exact same chemical make up as biologics (). The reason for this is the fact that biologics are large scale molecular drugs that require a complex system to make the biologics. Biosimilar drugs would act like how generic drugs do in today’s market. One of the key goals of biosimilar drugs is to lower the overall cost of a medication (). The best way to describe it is the amount of money spent on a biologic as a patient is extremely high and the cost of a biosimilar drug would save the patient money by charging less.
We analyzed the Indian Pharmaceutical industry on these five forces and the findings of industry competitiveness and profitability are written under the relevant competitive forces.