The Global Pharmaceutical Industry: Swallowing a Bitter Pill

Topics: Medicine, Pharmacology, Industry Pages: 3 (851 words) Published: May 15, 2013
The Global Pharmaceutical Industry: Swallowing a Bitter Pill The case describes the evolution of the pharmaceutical industry and its strategic environment. Attention is drawn to environmental pressures from regulators and payers. Key forces driving the industry are discussed, including addressing unmet medical needs, the importance of innovation and time to market, and globalisation. The case illustrates how an increasingly hostile environment, combined with a decline in R&D productivity, led to waves of job losses, and sparked a fresh round of consolidation. On the global level, the historical supremacy of the US was challenged with the highest market growth rates recorded in the emerging markets.

Q1. Identify the main environmental forces currently affecting the global pharmaceutical industry. It is expected that all aspects of the PESTEL analysis will be addressed. Illustrative points are given here, but this is by no means exhaustive. Political – Government’s focus on the industry as an easy target in the drive to reduce healthcare expenditure; public outcry over safely alerts and international price comparisons; and public pressure to fund cancer medicines. Economic – Pharmaceutical sales correlate closely with GDP – flattening in established markets and growth in emerging markets; the rise in the power of payers as decision-makers; in some countries patients are paying a greater proportion of drug costs themselves leading to increased linkage of sales and income levels; availability of venture and depth finance to support biotech innovation. Social – Aging population drive not only increases in healthcare costs but also increases in demand for medicines; pressure to act ethically rather than purely following profit; the number of better-informed patients with rising expectations; continued global convergence in medical practice and public acceptance of new technologies such as stem cells and genetic testing. Technological – Scientific and medical...
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