Global Macrotrends in Pharmaceutical Industry

Global Macrotrends in Pharmaceutical Industry

Suganya S. (SSN College of Engineering, India)
Copyright: © 2019 |Pages: 25
DOI: 10.4018/978-1-5225-5921-4.ch004


The pharmaceutical industry is trending in business decisions to demonstrate financial impact, influence on the behavior of consumers, governments, and businesses. This impact is beyond geographies and industries. It must be understood how a trend's impact will manifest itself in an actionable business planning horizon. Most of the pharmaceutical industries believe that global trends will shape business decisions over the next 5 to 10 years. Each management team in the pharmaceutical industry works on the global forces shaping their strategic context. The collisions approach is a systematic way to capture trends in strategy that enables your leadership team to rapidly combine multiple trends, facts, and perspectives to identify the “market-shaping force” that has the power to significantly shift spending and profit pools. This chapter discusses the effective competition in the pharmaceutical industry in the implementation of new technologies and trends to contribute to broader solutions.
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Strategic Management

In this section, the examination of the present and future environment elements of an organization or industry is made where objectives are formulated, implemented, achieved, and evaluated. The factors are used to determine the macrotrends as follows.

Drug Pricing

Pricing pressures around the world and unanswered value gaps to differentiate new medicines add to the potential for healthcare system bankruptcy as it currently exists, because medical care inflation continues to be unchecked. It reforms the market changes that impact device and drug manufacturers.

Pricing is one of the major reasons for the growth of biologics that continue to dominate the pharmaceutical news in the coming years. Charging high prices for pharmaceutical products may gain money to be used in the research and development of new drugs. National and international funding agencies have been spent fund on drugs that mean less money for other healthcare or nonhealthcare services. The Centers for Medicare & Medicaid Services (CMS) ( reimburse the money that market shareholders fix to control the costs of drugs. The pricing pressure on providers, hospitals, and health systems affects the patients to get medications they need. How the drug choices and value delivered is yet paid attention by the public and private players. Such pressure on biologic drugs makes manufacturers rethink the business model. Much drug foundation financially encourages pharma industries to develop a drug for deadly diseases as personalized treatments continue to drive biopharmaceutical innovation.

Pharmaceutical manufacturing trends also meet with the real market challenges of flexible biologic drugs, closer partnerships between the pharmaceutical industry and regulators. It results in the novel concepts to be implemented faster with existing talents that are influencing biopharmaceutical trends to meet the drug availability demands.


Provider network offers knowledge for patients to choose a network for health plans. Increasing healthcare costs continue to outpace inflation, creating greater incentives for insurers to offer plans with high deductibles and narrow networks. The consumer questions the access quality of the narrow network. Medicare Advantage plans provide the adequate knowledge on proper fee (Pharma Outlook, 2017).


Market trends collide, and employers have become concerned about their ability to continuously offer health benefits that will maintain a healthy, productive workforce. The employees must be able to analyze the benefits that are viable to offer health coverage, especially when employers are faced with uncertain insurance premiums. Consumer-directed health plans, in which employers are considering, include offering health plans with increasing employee cost-sharing and offering employees a defined contribution to purchase their own coverage.

Key Terms in this Chapter

Generic Drug: A term referring to the chemical makeup of a drug rather than to the advertised brand name under which the drug is sold. A term referring to any drug marketed under its chemical name without advertising.

Cultural Sclerosis: The prevailing management culture, mental models and strategies on which the industry relies are the same ones it’s traditionally relied on, even though they’ve been eclipsed by new ways of doing business.

Harmonization: Lack of clarity of pharmaceutical product exists, even around such deceptively obvious concepts as regulatory cooperation is a stumbling block to harmonization.

Biologic Drug: Biologic drugs are made by a living cell, typically an engineered bacterium or a yeast. That gives them the capacity to be chemically much more complicated.

Biosimilar Drug: When the patent surrounding a biologic's formula is no longer protected, multiple companies can release a drug with the same chemical recipe, driving the cost down. That new biologic drug is a biosimilar.

Price-Gouging: Price-gouging is a sharp criticism of both branded and generic products, as well as new and established medicines not particular to any country but globally extends to all pharma companies.

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