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Seminar 3 – Pharmaceutical Industry P.608
2006
Market Situation: a) Predicting pharmaceutical market growth at 10-year low
b) Loss of patent protection
Market: Shifting from mature markets to emerging markets
Key role: Specialty and niche products
Stakeholders: Regulators, payers and consumers



1) Identify the main environmental forces affecting the pharmaceutical industry
PESTEL
Political
- Worldwide government politically easy target to control rising health care expenditure
- Price control led to parallel trade

Economic
The pharmaceutical industry is one of the largest, longest standing and most knowledge intensive sectors in the United States economy. It directly and indirectly supports millions of jobs and pays above average-level wages to pharmaceutical industry workers. Its economic and scientific contributions propel many key states and regions

Pharmaceuticals and related activities are among the most research-intensive sectors in the economy, seedingA its future discoveries by investing over $27.4 billion in research and development in the United States.2 The pharmaceutical industry accounted for almost 8 percent of total industrial research and development investment in the United States in 1999 and that probably approached 10 percent in 2003

Social-cultural
Ageing population
Technological
- Highly risky
- Lengthy R&D process (10-15 years for an experimental drug from lab to patients)
- Costly: Cost for developing and commercializing new drugs: $800 m
Environmental
Legal
- Stringent government regulation


Political. The current and potenial influences from political pressures. eg different political acceptance of certain drugs/treatments; differing political attitudes to pharma companies.

iii) Economic. The local, national and world economy impact. eg is there any link to the economy or are pharma sales largely independent; indirect links between economic prosperity and level of healthcare; what are the...