Question

Prescription Drugs: Describe and discuss the rationale for considering the pharmaceutical industry a public policy dilemma.

Answer 1

Ans) Pharmaceutical companies are heavily regulated to ensure they are in compliance with federal safety laws.

- In the United States, the Food and Drug Administration (FDA) ensures that new drugs are rigorously tested for safety, efficacy and minimal side effects.

-  A pharmaceutical company, or drug company, is a commercial business licensed to research, develop, market and/or distribute drugs, most commonly in the context of healthcare. They can deal in generic and/or brand medications. Drug development is considered a costly and intensive process.

- The activist government policies of the past few decades have been a major factor contributing to the adverse trends observed in the case of pharmaceutical innovation.

- Public policy in pharmaceuticals has been characterized by increasingly stringent regulatory controls, shorter effective patent terms, and increasing encouragement of generic product usage. While all of these policies have been well-intended, in combination, they have produced significant unintended adverse side effects on the drug innovational process.

- They have contributed to the present situation of fewer independent domestic sources of innovation and fewer annual new drug entity introductions. This has occurred despite a steadily expanding base of rich, scientific, opportunities emerging from basic research endeavors.

- Outside the support of basic research, there has been very little attention given by policymakers to the effects of government policy on industrial innovation.

- This is a particularly myopic and sub-optimal approach to public policy. Historically, new drug innovations have played a central role in medical progress.

- Furthermore, new drugs have frequently replaced much more costly and less effective medical treatments, leading to substantial resource saving in medical expenditures. Hence, economic and health gains generally have been realized in a complementary fashion.

- It is now time to reform our regulatory and other industrial policies to insure that a conducive atmosphere for vigorous competition in new drug innovation will hold in the years ahead.