From Wikipedia,
the free encyclopedia.
A pharmaceutical company
(or drug company) is a
company licensed to discover,
develop, market and distribute
drugs.
History
Most large pharmaceutical
companies were founded in the late
19th and early 20th century, and
derive their market share from a
few well-marketed preparations.
Drug development
Drug development is considered
a costly and intensive process. Of
all compounds investigated for use
in humans only a small fraction is
eventually marketed, and only
after heavy investment in
clinical trials to determine
the safety and efficacy of a
compound. The cost for a new drug
is estimated to be about $1
billion. Depending on a number of
considerations, a company may
apply for and be granted a
patent for the drug or the
process of producing the drug for
about 20 years. Only after
rigorous study and testing, which
can take as long as 12 years, will
governmental authorities grant
permission for the company to
market and sell the drug.
Marketing
Drugs are initially sold at a
price higher than after
competition is introduced. When
the patent for the drug runs out,
a generic is usually created by a
competing company and released,
causing the price to drop
markedly. Drug companies spent
$900 million on consumer ads in
the first half of 1999 alone.
Pharmaceutical companies fund
non-profit "patient groups" that
consume their drugs. Patient
groups advertise for the drug
companies, and are unregulated by
the Food and Drug Administration
(FDA). Advertising directly to
consumers, however, is strictly
regulated in the United States by
the FDA, as described in
FDA Guidance for Industry on
Consumer-Directed Broadcast
Advertisements.
Some medications only show to
have safety issues after they are
marketed, as clinical trials are
of a limited size, such as the
3,000 test subjects required by
the FDA.
Post-marketing surveillance
ensures that after marketing the
safety of a drug is monitored
closely. In certain instances, its
indication may need to be limited
to particular patient groups, and
in others the substance is
withdrawn from the market
completely. Where pharmaceutics
have been shown to cause
side-effects,
civil action has occurred,
especially in countries where
tort payouts are likely to be
large. Due to high-profile cases
leading to large compensations,
most pharmaceutical companies
endorse
tort reform.
Not all countries allow
direct-to-consumer marketing.
Where this applies, pharmaceutical
companies may only advertise to
doctors and other health
professionals. Drug companies
spend $5 billion annually sending
representatives to doctors'
offices.
Between 1980 and 1997, drug
industry funding for academic
research rose x8, as research
costs rose, and the rate of
federal support fell. Drug
researchers not employed by
pharmaceutical companies often
look to companies for grants, and
companies often look to
researchers for studies that will
make their products look good. 79%
of papers written by independant
researchers are favorable to new
drugs. 98% of papers written by
researchers sponsored by the drug
companies are favorable. Sponsored
researchers are rewarded by drug
companies by puttting them on
symposium circuits to lecture,
with the lecture scripts written
by pharmaceutical companies. Some
researchers who have tried to
publish papers that show harmful
effects of new drugs or cheaper
alternatives have been threatened
by drug companies with lawsuits.
Controversies
Recently, some large companies
have received a fair share of
criticism. Examples are:
- Accusations of forging or
suppressing clinical trial
results to maximise uptake of
some medications;
- Accusations of manipulating
the market for their products by
showering doctors with free
gifts[1].
- Too much advertising
materials in the doctor's
office, such as clocks, poster
ads, etc.
- Aggressive representation by
pharmaceutical companies'
salespeople (detailmen).
- Sponsorship of
medical schools, with
influence on the curriculum to
discourage the teaching of
alternative medicines.
- Increased number of drug
tests on animals before
FDA approval
- Criticism for keeping the
price of
patented
AIDS medication artificially
high, limiting theraputic
options for patients in the
Third World, where the most
people have AIDS. The patents,
enforced worldwide by the
World Trade Organization,
bar the cheap generic
manufacture of these
medications, and third world
countries often lack the
economic resources to purchase
expensive brand-name drugs from
their American and European
manufacturers. Pharmaceutical
companies claim that lowering
the price will not generate
enough
profits, and cannot be
justified given these drugs'
high development costs.
Proposals to allow the
manufacture generic AIDS drugs
are not without controversy; it
is sometimes claimed that this
might cause pharmaceutical
companies to move away from AIDS
drug research and focus their
research on other, more
profitable areas. In March of
2001,
South Africa was sued by 41
pharmaceutical companies for
their
Medicines Act, which allowed
the import and generic
production of cheap AIDS drugs.
The case was later dropped after
protest around the world.
Eventually, the patents for the
AIDS drugs will expire,
allowing cheap generics on the
market. By then, millions will
die who could have been saved.
Bibliography
- Ray Moynihan, Alan Cassels:
Selling sickness: How the
world's biggest pharmaceutical
companies are turning us all
into patients". Nation Books,
New York, 2005.
- Merrill Goozner: The $800
million pill.
[2] University of California
Press, Berkeley, 2004, 297 S.
ISBN 0-520-23945-8.
- Marcia Angell: The truth
about the drug companies.
Random House, New York, 2004,
305 S.
ISBN 0-375-50846-5.
See also
