...The Pharmaceutical industry in India is the world's third-largest in terms of volume and stands 14th in terms of value. The Indian pharmaceutical industry has become the third largest producer in the world and is poised to grow into an industry of $ 20 billion in 2015 from the current turnover of $ 12 billion The government started to encourage the growth of drug manufacturing by Indian companies in the early 1960s, and with the Patents Act in 1970.[5] However, economic liberalization in 90s by the former Prime Minister P.V. Narasimha Rao and the thenFinance Minister, Dr. Manmohan Singh enabled the industry to become what it is today. The lack of patent protection made the Indian market undesirable to the multinational companies that had dominated the market, and while they streamed out. Indian companies carved a niche in both the Indian and world markets with their expertise in reverse-engineering new processes for manufacturing drugs at low costs. Although some of the larger companies have taken baby steps towards drug innovation, the industry as a whole has been following this business model until the present. The number of purely Indian pharma companies is fairly low. Indian pharma industry is mainly operated as well as controlled by dominant foreign companies having subsidiaries in India due to availability of cheap labour in India at lowest cost. In 2002, over 20,000 registered drug manufacturers in India sold $9 billion worth of formulations and bulk drugs. 85% of...
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...PHRMA Table of Contents 1) Introduction page 3 2) History/Overview of the Industry page 3 3) Economic Characteristics page 4 a) Structure b) Costs c) Demand d) Competition- The Rise of the Generics e) Market Failure, Government Intervention and Price 4) Performance page 7 5) Impact of the Global Economic Downturn page 9 6) Summary page 10 7) Conclusion page 11 Bibliography page 12 8) 1. Introduction This paper briefly examines the current state of the pharmaceutical industry, as well as the economic characteristics, performance, and the impact of the global recession. The industry is made up of several enterprises engaging in the research, development, manufacture and marketing of medicines, vaccines, medical devices, and nutritional products for humans and animals. Though, this multi-billion dollar industry includes large ethical drug multi-nationals (often referred to as Big Pharma), mid-sized specialty pharmaceutical companies, manufacturers of generics, small biotechnology and biopharmaceutical firms, and service companies, 1 for the purpose of this paper, the emphasis will be mainly on drug makers. 2. History/Overview of the Industry The pharmaceutical industry of today is a far cry from its humble beginnings in the nineteenth century of physicians mainly prescribing plant extracts to being technology intensive, dominated by a few...
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...Ethical drugs - Generic drugs - Biotechnological drugs - OTC drugs - Vaccine drugs PESTEL : Political : - In the Pharmaceutical market, the government has a huge impact concerning the existence of an universal coverage system in some countries like France (which is concerned as the country with the most efficient health system in the world), this unable to introduce latest treatments but share benefits with people giving the chance to poor people to have access to treatments. The US government is thinking about instoring a system like that. - Stringent government regulation, the government can control the prices, for example in the European Maket. That led to create parallele trade, thanks to the free trade agreement and with with the principle of free move of goods, the distributors can ship low-price drugs in low-price market in order to sell them in high-price market. - There is no formal government price control in the US which create a complete paradoxe with Canada, where the same drugs are cheaper than in the United States. In Canada there’s a stric regulation control, prices are inflexible and Canada has reimbursement criteria. - After the thalidomid tragedy which caused birth defects, the governments had to regulate the market and that led to the increasing of controls on trials. - Limit for the duration of patent protection (20 years from initial filling) that conduce to the appearence of generic drugs which led to...
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...highly controlled by healthcare authorities and governmental regulations, due to medical and safety concerns. For example, governments and authorities obligate firms to obey manufacturing and registration laws, storage conditions, labelling and packaging, product marketing, distribution, public awareness, prescription and patenting (John, et al. 2007), and this is what makes pharmaceuticals unique at the industry level. Pharmaceutical companies are classified according to their level of investment in Research and Development (R&D): the “Principal Companies” are the companies which have large investments in R&D to produce patented drugs, whereas “Generic Companies” produce offpatent drugs. Generic drugs (Generics or Branded Pharmaceuticals) are defined by Brems et al. (2011) as off-patent drugs which are not offered by the original manufacturer (Principal Companies) and under different brand names, and they represent a substantial part of the pharmaceutical business because of lower prices, multi-sourcing and they provide access to essential medicines. Introduction to Hikma Pharmaceuticals Hikma Pharmaceuticals PLC is a multinational pharmaceutical group which focuses on developing, manufacturing, and marketing a range of both...
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...provides an overview of the modern US generic drug industry evolution after the Hatch-Waxman Act of 1984, considered one of the most significant legislation impacting generic drug approval to the US pharmaceutical market. In the early 1980s, there were very few generic drug products in the US market. Although the Federal Food, Drug, and Cosmetic Act (FD&C Act) made it possible to gain generic drugs approval via the “paper new drug application (NDA)”, it was still difficult for generic companies due to insufficient scientific literature published by innovator companies that supported justification of safety and efficacy. In response, the Hatch-Waxman Act was negotiated and amended the FD&C Act by creating an Abbreviated NDA (ANDA) for approval of a generic drug by the FDA on the basis of bioequivalence – clinically showing the same efficacy and safety as the reference product....
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...Herzl, has accomplished anything as remotely as impressive in this country as Hurvitz. It was impossible, a million to one odds at best, and he still did it. He woke up one morning and started walking. — Ori Hershkovitz, equity analyst at Tel Aviv-based Leader & Company The markets had not been kind to Teva Pharmaceutical during the first half of 2006. The stock had plunged nearly 30% from January 1 to June 30, erasing billions of dollars from the company’s market capitalization. Even good news, such as reports in July of Teva’s wildly successful introduction of generic Zocor—the largest blockbuster drug ever to go off-patent—had failed to boost the stock significantly. Since nearly every retirement fund and mutual fund in Israel invested in Teva, this drop had been felt throughout the population, in effect amounting to every Israeli family losing NIS 3000, or $675.1 Teva was more than the world’s leading producer of generic pharmaceuticals (see Exhibit 1 for financials). It represented the gold standard of business in Israel. As the country’s largest public company and first true multinational, it had avoided the traditional conglomerate model of early Israeli enterprises, choosing instead a highly focused approach embraced by later generations of successful Israeli firms. With revenues growing from $91 million in 1985 to an estimated $8.5 billion in 2006, the company had bred a new class of professional...
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...Do generic products really save you money? With the price of living getting higher and higher as very year passes, people are looking for alternative ways to save money. The main reason for buying generic products, saving money, is simple enough. But there's also the satisfaction of not giving in to the marketing hype and buying something just because a company promotes it everywhere. The generic labels may not be as fancy as the brand-name products, and the taste of generic items, such as soda, may not appeal to you depending on your taste buds, but it's worth trying generic brands to see if you like them. The savings can add up over a lifetime, as a savings calculator can quickly show you. And if the savings isn't enough, or the brand name is much better than the generic, you can always go back to the branded product. You can even buy popular brands from the past. But remember the power of brands. Since the same manufacturer of a brand-name product often makes the generic product with the same ingredients, what the company selling the branded item is selling is the perception of something better. Consumers don't buy generic products because they think it makes them look bad, said Jason Gurwin, CEO of Pushpins, a mobile coupon company. Over-the-counter medications.Since the Food and Drug Administration requires generic medications to have the same active ingredients as the patented medications they replace, over-the-counter medications are the best way to save money by...
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...drawbacks consumers have to face when two companies merge will be addressed as well. Introduction An investigation into a pharmaceutical company’s supposed intentions to curtail generic competition regarding an antidepressant drug, which is the company’s best brand name seller, has brought about a few questions as to why the company would do this to consumers. Prescription medication is expensive enough without pharmaceutical companies hindering the market entry of its generic counterparts. Generic medication gives consumers a choice to spend more or to spend less for their health care, and in the long-run gives them a choice for a more cost-effective livelihood. Without the options of choosing a cheaper form of medication, consumers are being taken advantage of. This leaves no room for choice and thwarts fair market competition. With a 22% increase of profits in comparison to the previous year, it is quite obvious that this brand- name manufacturer and generic companies have disobeyed federal antitrust laws. Therefore the Federal Trade Commission is performing an investigation to ascertain if brand name companies and generic drug makers have acquiesced the stymie of generic competition, which leads us to our first question. Why would the drug maker want to stymie generic competition? Antitrust Laws such as the Sherman Act, Federal Trade Commission Act, and the Clayton Act have been created in order to diminish...
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...To start a company, a person or group of people must realize that it is a bumpy ride from the beginning, and that only those who are prepare enough will succeed. They have to follow multiple rigorous steps and come up with innovative strategies to prove that they have what it takes to be successful in the business. Pfizer Inc. is a company that has proven itself throughout time. They are the world’s largest research based pharmaceutical company and were also recognized by Fortune magazine as the world’s largest pharmaceutical company by profit and second largest by revenue, only next to Johnson and Johnson (Fortune, 2013). Pfizer Inc. have evolve throughout the years along with science and have been responsible for the discovery and marketing of some of the world’s most innovative drugs like, Lipitor (use to decrease cholesterol), Lyrica (use for treatment of fibromyalgia), Zithromax (a renown antibiotic), and many others. Although they focus mainly on human drugs, they also produce animal and consumer healthcare products. The company have apply their science and global resources to help and make a positive impact in the quality of life and health of millions of people and animals around the world. To prove their commitment and dedication to health and business improvement, in 2012...
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...Generic drugs are copies of brand-name drugs that have exactly the same dosage, intended use, effects, sideeffects, and route of administration, risks, safety, and strength as the original drug. In other words, their pharmacological effects are exactly the same as those of their brand-name counterparts. Many people become concerned because generic drugs are often substantially cheaper than the brand-name versions. They wonder if the quality and effectiveness have been compromised to make the less expensive products. The Food and Drug Administration (FDA) requires that generic drugs be as safe and effective as brand-name drugs. Actually, generic drugs are only cheaper because the manufacturers have not had the expenses of developing and marketing a new drug. When a company brings a new drug onto the market, the firm has already spent substantial money on research, development, marketing and promotion of the drug. A patent is granted that gives the company that developed the drug an exclusive right to sell the drug as long as the patent is in effect. As the patent nears expiration, manufacturers can apply to the FDA for permission to make and sell generic versions of the drug; and without the startup costs for development of the drug, other companies can afford to make and sell it more cheaply. When multiple companies begin producing and selling a drug, the competition among them can also drive the price down even further. So there's no truth in the myths that...
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...Pay for Delay Written By: Jed O’Brien Metropolitan State College of Denver at Denver November 24, 2011 For years pharmaceutical companies have been trying to protect their expensive drugs, protected by patents, by paying rivals large sums of money from producing cheaper, alternative drugs. In an article written by Marian Wang, she discusses a particular case in which Pfizer makes “…a deal with certain pharmacy benefit managers … to block generic versions of Lipitor.”(Wang, Pfizer’s Latest Twist on ‘Pay for Delay’) There are a few ethical issues with this: one, the rival companies are infringing on patent laws, two, larger pharmaceutical companies are trying to create as much profit for their company until their patent runs out, and three, Americans in need of the drug are forced to pay higher prices for their drugs. The latter two issues go hand in hand with one another. Patents are used to protect a company’s invention and gives the company exclusive rights to sell that invention. In this case the invention is a drug. But, in the drug business, companies can get a hold of a drug and break down the chemical components making it easy to duplicate. It is not right for competitive companies to be able to easily break down a drug when all the hard work has been done by another and profit. Just because there have been minor adjustments with the chemical structure of the drug gives the rival company the right to market and sell their product. At the same time doesn’t...
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...take. Ranbaxy Laboratories wants to be bought out, but Eli Lilly is worried of the financial implications of such move. There were two pharmaceutical companies that were looking for ways to expand globally to position themselves in a competitive advantage from their competitors. One was located in the United States, which was Eli Lilly and Company and the other one was located in India, which was Ranbaxy Laboratories. Research and development was crucial to Lilly’s long-term success. Ranbaxy Laboratories was a firm that was evolved into a serious research-oriented firm. With the change, in the government, India was attracting foreign investors in the pharmaceutical industry. Lilly decided to form the joint venture in India to focus on marketing Lilly’s drugs there, and a formal JV agreement was signed in November 1992. The main key issues of this case are as follow. The pharmaceutical industry had come about through both forward integration from the manufacture of organic chemicals and a backward integration from druggist-supply houses. The industry’s rapid growth was aided by increasing worldwide incomes and a universal demand for better health care; however, most of the world markets for pharmaceuticals were concentrated in North America, Europe and Japan. Drug discovery was an expensive process, with leading firms spending more than 20 per cent of their sales on research and development (R&D)....
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...Programme : BTECH-MANAGEMENT IV Question 1 Identify the main environmental forces currently affecting the global pharmaceutical industry? PESTEL analysis of the global pharmaceutical industry: Political * Governments set stringent regulation and is a powerful purchaser. * Governments around the world focus on pharmaceuticals as a politically easy target in their efforts to control rising health care expenditure. * Inter-country pricing disparities. Economic * European free trade agreements. * Deregulation of market to allow foreign drugs to compete. Social * Ageing population puts pressure on healthcare systems. * Epidemic of chronic diseases. * Rising consumer expectations. * Payers choosing generic drugs for first-line treatment of common ailments. Technological * Increase productivity, decrease costs and develop new treatment modalities to enhance profitability. * Impact of Internet on traditional business models. * Impact of genetic research on industry. Environmental * Industry operations are becoming more stringent with increasing standards and requirements for environmental protection. Legal * Rigorous regulatory scrutiny governed by legislation. * Legislation enacted to set a fixed period on patent expiry. Question 2 Use scenario planning techniques to consider the various environmental influences which may affect the global pharmaceutical industry in the future? Key...
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...Q1. Identify the main environment forces currently affecting the pharmaceutical industry. PESTLE analysis is used to help the organization to understand what is the current status of the organization and the external factors that are affecting it, whereas this also helps the management of the organizations to overcome the weak areas organizations by implementing the strategy for the future. Political The policies of the government had a great effect on the regulations and legal issues that defines both formal and informal rules for the industries innovations as compared to the other factors in the form of “parallel trade” as the attention of the industry was an increase in the economic importance’s where the government offered incentives that encouraged the industry to globalization as they focused on pharmaceutical industry to handle the challenges of price control, monopoly and trade. Overtime this led to a wide disparity in prices that exposed the industry to sensationalist newspaper headlines and consumer backlash. Economic The sales in the pharmaceutical related closer to the GDP due to the effect in interest, taxes, inflation and exchange rates that layered down the established market growth in emerging the market for the power of the payers as decision makers. The change that could also affect the foreign currency can also affect the export and imports of the drugs. Patents in other countries pay a lot for the proportion of drug cots themselves that leads to...
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...industry we have two kind of medications which are generic or innovative. Innovative pharmaceutical industry success depends on the patent protection in the industry. For example, in United States innovative industry can have 10 to 12 years of patent protection life from the time that product is for sale in the market. Success of the generic pharmaceuticals which are bioequivalent to innovative pharmaceutical is also related to the political and legal environment of their market. If we look at pharmaceutical industry globally we can see that regulations toward generic pharmaceutical are different in different countries. For example, in United States they have the Hatch-Waxman ACT 1984including Abbreviated New Drug Application which reduce the drugs approval period and give the chance to Generic companies to have a 180 day exclusivity period if the generic company can submit an abbreviated new drug application before other generic competitors. In Europe regulations are different in each country for example, United Kingdom and the Netherlands are very similar to USA, and countries such as Germany and France are more physician-driven or branded generics market and the cost of sale for generic products are higher in these countries. Market for generic drugs in the rest of the world also depend on the regulations in each country. For example Japan and East Asian market are highly regulated and generic drug occupy only 10% of pharmaceutical drugs in...
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