Drugs and Medication
Legal drugs are natural or synthetic substances which are used for the treatment and/or prevention of a disease or the symptoms of a disease. The process involving the use of drugs in the treatment and cure of various health ailments is known as medication.
Pharmaceuticals are a huge industry with about $1 trillion spent globally every year on medicines as part of health care. Novartis, Pfizer, Roche and Sanofi are some of the largest pharmaceutical manufacturers. Drugs introduced into the market are the result of time- consuming and expensive research and development (R&D) and clinical trials. On average only two of every 10,000 chemical substances synthesized reach the manufacturing stage.
There are four main types of drugs available for medication around the world:
Branded medicines: These are chemical drugs discovered by a pharmaceutical company which, after gaining a license, markets these medicines under a brand name. The original manufacturer holds the exclusive rights to market the medicines under its brand for the licensed period.
Generics: Once a patent expires, other drug companies then have the right to manufacture and market the chemical drug. However, they must market it under its generic name, or under a different brand name.
Biopharmaceutical products: Biological products are generally derived from a living organism. They can come from many sources, including humans, animals, micro-organisms or yeast.
Biosimilars: These are the alternative version of an original biopharmaceutical product. A biosimilar product is very similar but not identical to the original biological product due to the complex structure of biologic medicines. . Minor differences in the active ingredient are expected and permitted in biosimilars as long as these differences are not clinically critical, and the drugs are effective and safe.
Regional Market Shares
The USA, Germany, France and the UK are some of the largest producers of drugs, accounting for two-thirds of global production. According to the Pharmaceutical Research and Manufacturers Association, the USA conducts the majority of the world’s R&D in pharmaceuticals and holds the intellectual property rights on most new medicines. As a result, more than 50% (by sales) of medicines introduced in recent years came from the USA. The USA is also the world’s largest market for pharmaceuticals, accounting for around 30% of global spending on drugs.
Europe accounts for about 20% of the global spending on drugs. Of these, Germany, France, Italy, the UK and Spain are some of the countries where spending on medicines is particularly high. Drugs spending in Europe is likely to remain flat over the next few years owing to a weak economic recovery, low population growth and continued efforts to reduce public debt.
Emerging countries in Asia and Latin America are forecast to grow rapidly to a point where they account for more than 35% of the global drugs spend. Increases in spending in these countries will be driven by a rising incidence of disease, favorable government policies and improving healthcare infrastructures. Spending on medicines in China in particular is likely to grow exponentially to reach more than $160 billion a year by 2018.This is likely to make China the world’s second largest pharmaceuticals market. Implementation of health reforms and the increasing size of the ageing population are expected to drive the market in this country.