Pharmaceutical Drugs and Drug Companies

In: Business and Management

Submitted By ngaevo
Words 536
Pages 3
:
It depends on how you look at it, some people conceder drug companies to be monopolistically competitive but I think it is an oligopoly. Oligopoly is a market structure with significant barriers of entry and exit, many consumers and few firms. With a close look of the drug business you will realize that is it has all the characteristics of an oligopoly started above. Because of the fewer number of firms there is always the tendency of collision, secondly in a relatively un-concentrated market barriers to entry and may simply reflect high operating cost. The high cost of getting this product to the market include clinical trials, patent approval and FDA approval; industry-financed studies claimed $114 million 1987, later went up to $231 million, $403 million, and then $2.1 billion in 2006 for FDA approval, patent approval and clinical trials. Oligopolies in most cases tend to go multinational which is largely associated with todays’ drug companies.
In terms of research and development, I will say it is the backbone of the pharmaceutical industry which makes it very important. I will want to focus on Pfizer one of the big names in this industry. Pfizer’s Global Research and Development is probably the group that the company takes the most pride in for obvious reasons. If we take a broader look at R&D we will see the role and importance of Contract Research Organizations (CROs). CROs account for about 20 percent of drug companies' traditional development business, according to Graham Hughes, a founder and scientific director of Technomark Consulting Services, a London-based firm that has specialized in CROs since…...

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