Pharmacology and the Pharmaceutical Industry

PHARMACOLOGY & THE PHARMACEUTICAL INDUSTRY

A truly new drug (one that does not simply mimic the structure and action of previously available drugs) requires the discovery of a new drug target, ie, the pathophysiologic process or substrate of a disease. Such discoveries are usually made in public sector insti-tutions (universities and research institutes), and the molecules that have beneficial effects on such targets are often discovered in the same laboratories. However, the development of new drugs usu-ally takes place in industrial laboratories because optimization of a class of new drugs requires painstaking and expensive chemical, pharmacologic, and toxicologic research. In fact, much of the recent progress in the application of drugs to disease problems can be ascribed to the pharmaceutical industry including “big pharma,” the multibillion-dollar corporations that specialize in drug discov-ery and development. As described, these companies are uniquely skilled in exploiting discoveries from academic and governmental laboratories and translating these basic findings into commercially successful therapeutic breakthroughs.

Such breakthroughs come at a price, however, and the escalat-ing cost of drugs has become a significant contributor to the inflationary increase in the cost of health care. Development of new drugs is enormously expensive, and to survive and prosper, big pharma must pay the costs of drug development and market-ing and return a profit to its shareholders. Today, considerable controversy surrounds drug pricing. Critics claim that the costs of development and marketing are grossly inflated by marketing activities, which may consume as much as 25% or more of a com-pany’s budget in advertising and other promotional efforts. Furthermore, profit margins for big pharma have historically exceeded all other industries by a significant factor. Finally, pricing schedules for many drugs vary dramatically from country to coun-try and even within countries, where large organizations can negotiate favorable prices and small ones cannot. Some countries have already addressed these inequities, and it seems likely that all countries will have to do so during the next few decades.