Essay on Current Trends in Pharmaceutical Business Models

Published: 2021/12/16
Number of words: 1017

Traditionally, pharmaceutical business models are made around blockbuster drugs, referred to as the blockbuster business model (Sreedhar & Udupa, 2016). The main aim of the blockbuster business model is to target mass markets to get revenues from high sales. Blockbuster drugs are those drugs that have annual sales of above US$1 billion (Coopers, 2009). Zantac achieved the first blockbuster, and many more followed after that. Examples of drugs considered blockbusters include those that create common medical issues such as diabetes, hypertension, asthma, cancer, and many more. The blockbuster business model of pharmaceuticals rotates around investing a significant budget into in-house research and development (Coopers, 2009). Several pharmaceutical companies invest a lot of money, trying to find drugs that can solve common issues. Most of the research and developments (R&D) hit dead ends despite its generation of high returns. However, it has been predicted that shortly, the blockbuster model will no longer work for many organizations, regardless of how big an organization is. Nevertheless, if it prospers, they will need to change their R&D. The significant contributors to the failure are decreased research and development, high cost, increasing payer influence, and diminishing exclusivity period (Coopers, 2009). If the pharmaceutical companies are to prosper, they must; reduce their cost, tap the potential of emerging economies, change from sell medicine, and focus on patient-centered outcomes. The pharmaceutical industry is slowly but steadily on integral models involving collaboration in planned experiments and partnerships where risks and benefits are shared. Due to the high competition in the pharmaceutical industry, the majority of the companies find it hard to maintain previous ranks and thus need to adopt new business models to get up the ladder.

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Currently, many health care payers globally have begun to consider and emphasize prevention (Coopers, 2009). Therefore, it is the responsibility of pharmaceutical companies to watch out for current trends to keep up with the future demand. Examples of current trends that will imply a change in the pharmaceutical companies include market trends, health and healthcare trends, and scientific research trends (Coopers, 2009). The markets trends include patients being better informed about the medical world, and therefore, pharma will be paid for the outcome and not drugs. Patients are more likely to select medications that have outcomes and not just any other. Moreover, patients are more likely to choose drugs that are considered more conservative to their health. Furthermore, patients pick up a more significant share of the bill; therefore, outcomes drive healthcare policies. Moreover, the emerging markets are becoming more critical, and thus pharma will have to consider their pricing strategies. Additionally, patients are now focused on cure, not treatment, pushing pharmaceuticals to provide a care package. In healthcare trends, the burden of chronic diseases is increasing and thus forcing pharmaceuticals to evaluate data outcomes (Coopers, 2009). Furthermore, healthcare payers are reevaluating health protocols, which will cause pharmaceuticals to collaborate with vendors to virtualize R&D. The boundaries between different forms of care are expanding, thus forcing pharmaceuticals to go global and collaborate with international organizations. The need for pay-for-performance is also increasing, implying that pharmaceuticals must develop a multidisciplinary skills base. R&D is becoming more sensitive and evaluated; thus, pharmaceuticals have to work more closely with regulations. Moreover, the research and development base is shifting into Asia, forcing involved parties to collaborate with payers and providers in performing trials as monitoring is also improving rapidly (Coopers, 2009)

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Opioid prescription is considered to be out of control currently in the USA. At least 2 million people have been established to have opioid use disorder involving prescription opioids (Phillips, 2017). It has been predicted that the numbers might go high compared to today and become a healthcare issue regardless of any policies out in place (Phillips, 2017). With the current trends in research and development with high visualization, pharmaceuticals producing opioid drugs will have to work hand in hand with each state’s regulations. As research and development go beyond boundaries to an international level, pharmaceuticals are expected to operate according to the laws and regulations of the respective state (Phillips, 2017). However, the implications of lawsuits by several states will reduce the production of opioid pharmaceutical products as many states have burned its use and prescription in the medical field. Nevertheless, in the quest for collaboration and sharing costs and losses, there could be an increase in the production of opioid pharmaceuticals to curb future trends. Moreover, collaborative research to improve healthcare and increase medication production to cure common health issues could advocate increased output of opioid pharmaceutical products. Furthermore, current trends in research and development show that virtualization and report monitoring will help prevent leaking opioid prescription systems that could lead to escalated misuse followed by OUD, which could lead to the trading of cheaper black market opioid products. Hence the lawsuits will impact the quality of research, development, and distribution of opioid pharmaceutical produces to achieve better healthcare outcomes among patients (Phillips, 2017).

Traditional models of pharmaceutical businesses have drastically changed. Whereas the blockbuster model is still in use, it has been predicted to be changing slowly but drastically. Current trends in marketing, healthcare, and R&D have impacted the model of business in pharmaceutical companies. Shortly, it is predicted that companies will have to work together and share losses and profits, to save on cost and meet current demands. Shortly, the business will be more focused on patient outcome and date assessment and not blockbusters’ method of operation. The new changes will impact opioid pharmaceutical products’ production by regulating illegal production and leaking prescriptions.


Coopers, P. (2009). Pharma 2020: Challenging business models. Which path will you take? UK: PWC.

Phillips, J. K., Ford, M. A., Bonnie, R. J., & National Academies of Sciences, Engineering, and Medicine. (2017). Trends in opioid use, harms, and treatment. In Pain Management and the opioid epidemic: balancing societal and individual benefits and risks of prescription opioid use. National Academies Press (US).

Sreedhar, D., & Udupa, N. (Eds.). (2016). Quality in Pharmaceutical Education, Research and Practice (vision 2020):-published by Manipal Universal Press. Manipal Universal Press.

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