Pharmaceutical Companies
NAU- Management Across Cultures
November 2010
There is a lot of discussion about pharmaceutical companies, intellectual property, and the global AIDS epidemic. Do pharmaceutical companies have a responsibility to distribute drugs for free or low cost in developing countries? Why is intellectual property such a big deal? What impact would South Africa’s decision to levy duties on drugs in the country have on the international distribution of drugs? Was the change that provided patent protection for pharmaceutical companies an appropriate change or a dangerous precedent? Was it necessary to relax intellectual property rules in order to ensure that adequate supplies of AIDs medications would be available for distribution in the developing world? What role to multi-national corporations have in providing funding or other assistance to international organizations such as the Global Fund? All these questions have many arguments for and against but the right answers probably lie somewhere in between. Having and providing access to affordable medication is one of the greatest challenges we face today. Many people see the pharmaceutical companies as socially irresponsible. The evidence is in the outrageous prices individuals have to pay for medications. Although I don’t like high priced medications I do believe in the right for a business who has the chance to face many lawsuits to make money. To come up with medications it takes years of research and licensing. The pharmaceutical companies don’t want their hard work to be the catalyst for another company to come in and make a cheaper version and take all the profits. With the protection of a patent, the companies that make the drugs can charge high prices in an attempt to make their money back. The profits are then spread to investors and also used for more research for better medications. According to the case in the textbook, on average it takes ten to fifteen years for a drug to be created from start
November 2010
There is a lot of discussion about pharmaceutical companies, intellectual property, and the global AIDS epidemic. Do pharmaceutical companies have a responsibility to distribute drugs for free or low cost in developing countries? Why is intellectual property such a big deal? What impact would South Africa’s decision to levy duties on drugs in the country have on the international distribution of drugs? Was the change that provided patent protection for pharmaceutical companies an appropriate change or a dangerous precedent? Was it necessary to relax intellectual property rules in order to ensure that adequate supplies of AIDs medications would be available for distribution in the developing world? What role to multi-national corporations have in providing funding or other assistance to international organizations such as the Global Fund? All these questions have many arguments for and against but the right answers probably lie somewhere in between. Having and providing access to affordable medication is one of the greatest challenges we face today. Many people see the pharmaceutical companies as socially irresponsible. The evidence is in the outrageous prices individuals have to pay for medications. Although I don’t like high priced medications I do believe in the right for a business who has the chance to face many lawsuits to make money. To come up with medications it takes years of research and licensing. The pharmaceutical companies don’t want their hard work to be the catalyst for another company to come in and make a cheaper version and take all the profits. With the protection of a patent, the companies that make the drugs can charge high prices in an attempt to make their money back. The profits are then spread to investors and also used for more research for better medications. According to the case in the textbook, on average it takes ten to fifteen years for a drug to be created from start
References: (2009). Lecture # 21 -- Pharmaceuticals in Developing Countries: Public Administration 776 -- Spring 2009 Economics of Science and Technology Benatar, S. (2000). ‘Avoiding exploitation in clinical research,’ Cambridge Quarterly of Healthcare Ethics 9: 562-65. HG.org - HGExperts.com. (1995-2010). Intellectual Properties: HG.org Worldwide Legal Directories Shafrin, Jason Ph.D. Economist. (2008, May 18). Healthcare Economist, Pharmaceuticals in Developing Countries http://healthcare-economist.com/2008/05/18/pharmaceuticals-in-developing-countries/ Shah, Anup, (2010, October 2) Research. Retrieved from http://www.globalissues.org/article/52/pharmaceutical-corporations-and-medical-research Sykes, Alan O, (2002, April 1)