five-forces model in the pharmaceutical industry Free Essay, Term Paper and Book Report
Pharmaceutical industry has experienced significant changes from the mid of 1990s. Though the U.S market has been the biggest market in the world (exhibit1) ,and the fastest growing market (exhibit2), there lots of obstacles to settle. The macro trend is outside pressures to reduce drug cost from various groups surrounding pharmaceutical companies. These pressures will pull down sales and profit growth, historically well over 10% to the single- digit range. Pressures related to pharmaceutical industry can be classified largely into 5 categories ; Managed care organizations, policies of pharmaceutical industry, foreign governments, public opinion, and biotechnology companies. Each group are opposed to the interests of pharmaceutical industry by reason of relieving economical burdens for senior citizens, poor people in Africa, different health-care systems in foreign countries, the bargaining power of buyers (ex: MCOs), and the threat of new entrants (ex: biotechnology companies). The industry has been one of the most profitable (pretax margins averaged just over 26%), but drug prices ......
Word Count: 833
Page Count: 3.3 (250 words a page / double spaced)
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