Brand Name Drug Case Study

Brand names in the drug industry face competition challenges from upcoming industries. The small industries produce generic drugs that are more affordable and readily available than the products from the large multinationals. Besides, the new brand name prescription drugs experience immense competition immediately when they are introduced into the market. The unfair competition affects the first cycle of the drug because generic products flood the market hindering the sales. Subsequently, the brand name drug ends losses more revenue on average than the counterfeit producers. In the end, the brand name drugs fail to maximize sales or profits in the entire market share. Nevertheless, the cost of a genuine drug cuts with every new standard syndicate that produces a similar copier. Therefore, enterprises that produce brand name products should establish appropriate countermeasures. The mechanisms entail having appropriate strategies to ensure that the brand name drug makes a profit it desires

Companies that produce new drugs under the patent right would increase their price. Hence, such entities charge high prices considering the monopoly position they assume. The status leads to exploitation of consumers bearing in mind the role drugs play in the society. Also, the time drugs take for approval by the FDA is a factor because it makes drugs production lifespan to last for 8 to 15 years even though it may vary in different countries. Other regulations affect the cost of research and design of the pharmaceutical products. Hence, the companies enjoying patent may make it difficult for other companies to enter the market. Finally, the government support or lack of goodwill as evidenced by subsidies or high tax respectively can stimulate or impede the growth of a firm. Hence, government involvement is critical to the growth or decline of a particular