Biomedical Engineering Reference
In-Depth Information
Fig. 9.1
Worldwide sales profi les of 1990-1994 new drug introductions, from Grabowski
et al. (
2002
)
multiple price-based competitors' once patent and other market exclusivities are
exhausted. Figure
9.1
is a graphic depiction of these sales dynamics created from
longitudinal drug sales data both pre and post patent expiry (Grabowski et al.
2002
).
The declining of this curve is most dramatic when the original innovator of a
multibillion dollar drug is confronted with generic competition, an undifferentiated,
bioequivalent product emulator that competes solely on price. More generally, these
sales dynamics are experienced in those markets where imitation of the original
innovator and price-based competition occur. This phenomenon is acute in those
contexts where price is relatively unregulated such as that for prescription drugs in
the United States (US). What does the academic and professional literature tell us
about the effi cacy of marketing management options that can be pursued to avoid
the literal downside of patent expiry in pharmaceutical markets? This article is an
attempt to address the chronic challenge of patent expiry revenue loss and the man-
agement of price-based competition from generics.
A pervasive challenge and management opportunity in this context is the
sequenced planning and execution of options in a proactive and or reactive sense
that can be used to slow down or even avoid the loss in revenues associated with
the market entry of generic emulators or other forms of price-based competition.
To examine this challenge, this article will present an interdisciplinary perspective
on the management of marketing, intellectual property, and policy options that are
specifi c to the pharmaceutical patent expiry event.
After summarizing a broad list of patent extension and or market exclusivity
options, this article considers the relevant literature on pricing of pharmaceuticals
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