There’s a relatively recent article that I came across that deals with the trouble that pharmaceutical companies are having. They are having major problems due to a number of factors. The former pharmaceutical researcher (Johnathan Bloom, Ph.D.) that wrote this article speaks about the obvious factors that are negatively affecting the pharmaceutical industry.
He covers the phenomenon of the large number of big money drug patents that are going to expire shortly. Just from expiring patents, he estimates that the Big Pharma industry will lose about $50 billion.
He also speaks on U.S. patent law, which allows a company to have exclusive rights to profits from the drugs that they produce. After taking in to consideration related issues, the effective length of the profit period is about 8 years. After that, generics are produced and the sales of the brand name drug plummet. In fact, he says that most drugs never reach a breakeven, since most of them take about a billion to develop. In this type of pharmaceutical environment, the blockbuster multi-billion dollar profit drug is a critical element in the pharmaceutical drug paradigm. continue reading…