The Pharmaceutical Industry
Pharmaceuticals have long played an indispensable role in delivering better health around the world. However, the pharmaceutical industry is large and complex. How it functions, how it’s regulated and how it provides patients access varies by location. To help provide clarity, we have illustrated important industry characteristics, which center around product types; kinds of markets, which are a function of who makes key decisions around pharmaceutical prescribing, dispensing or buying; and channels, through which our products make their way to patients.
Generic pharmaceuticals are therapeutically equivalent versions of brand-name medicines. They generally become available once the patents and other exclusivities on their branded counterparts expire. Generic drug makers also invest significant sums in R&D and in manufacturing capacity. They also often incur substantial litigation expense as a result of challenging unwarranted brand patents or exclusivities. But because generics developers are not required to reproduce expensive clinical trials and seldom engage in product promotion, generic drugs typically cost far less than brand-name drugs. The generics business is characterized by lower margins on higher volumes, as most generic drugmakers offer a relatively large number of products. Although generics companies have long been considered the industry’s advocates for access, they also play substantial roles as innovators, in areas ranging from dosage forms to packaging.