Extraordinary Pricing of Orphan Drugs: Is it a Socially Responsible Strategy for the U.S. Pharmaceutical Industry?

The PRIME Institute of the College of Pharmacy, University of Minnesota, recently released preliminary research findings indicating a trend of extraordinary pharmaceutical industry pricing of drug products in the United States (U.S.). According to researchers at the PRIME Institute, such extraordinary price increases are defined as any price increase that is equal to, or greater than, 100% at a single point in time. In some instances, PRIME Institute researchers found that drugs exhibiting extraordinary price increases are categorized as “orphan drugs” (or blood-related biologic treatments) and often life-saving or life-sustaining for treating the cause or symptoms of diseases affecting fewer than 200,000 people in the U.S., or where there is prevalence of less than 5 per 10,000 people afflicted with a disease or symptoms in the community. Because of extraordinary price increases for orphan drugs – some exceeding 1000% at a single point in time – this article addresses two interrelated questions: Are extraordinary orphan drug price increases socially responsible behavior? If so, are the pharmaceutical industry's policies providing orphan drug access to American consumers in dire need of available life-sustaining and life-enhancing pharmaceuticals considered “socially responsible” behavior? The author concludes, after an interdisciplinary analysis of the legal, economic, sociopolitical, and ethical dimensions of orphan drug pricing, that they are not socially responsible – unless justified by cost and availability of health care marketplace/patient options. Furthermore, the author recommends a socially responsible industry strategic approach to insure that patients ultimately receive – regardless of cost – timely access to life-saving and life-sustaining orphan drugs.     

R&D Costs,Innovative Output and Firm Size in the Pharmaceutical Industry

This study examines the relationships between firm size, R&D costs and output in the pharmaceutical industry. Project–level data from a survey of 12 US–owned pharmaceutical firms on drug development costs, development phase lengths and failure rates are used to determine estimates of the R&D cost of new drug development by firm size. Firms in the sample are grouped into three size categories, according to their pharmaceutical sales at the beginning of the study period. The R&D cost per new drug approved in the US is shown to decrease with firm size, while sales per new drug approved are shown to increase markedly with firm size. Sales distributions are highly skewed and suggest that firms need to search for blockbuster drugs with above–average returns. The results are consistent with substantial economies of scale in pharmaceutical R&D, particularly at the discovery and preclinical development phases.     

Understanding Needs and Concerns of the Elderly Regarding Medicare Health Maintenance Organizations

Medicare beneficiaries, who currently receive health care under a fee-for-service system, present new challenges and opportunities for Medicare-HMOs. Part of the challenge lies in discerning major need dimensions underlying the elderly's choice between standard Medicare and a Medicare-HMO. Although Medicare-HMOs have special features likely to be particularly beneficial to the elderly, they are not greeted without some disquietude. The paper focuses on identifying the major need dimensions and concerns of the elderly in choosing a Medicare-HMO over the traditional fee-for-service Medicare system.     

刍议新医改政策对制药企业药品营销的影响

近年来,我国医药行业有很大发展,消费保持高速增长,但仍然存在制药企业规模小、研发弱、市场集中度低,药品流通领域"多、小、散、乱"等问题。新医改对制药企业的药品销售从产品、价格、渠道和促销等方面都带来影响。制药企业要认真研读此次新医改相关政策和文件,规避新医改政策给企业造成的不利影响,并利用此次医改的时机和国家对医药行业进行结构调整的机会,从战略层面上来研究和寻求对策。     

人才盘点方案设计及与应用 ——基于HL药业的案例研究

随着医药行业竞争的加剧以及为了实现组织战略和业务转型的目标,医药制造企业仅仅依靠外部招聘已经不能满足企业发展和创新的需要,企业急需找到一种内生的加速人才培养的系统以突破人才培养困境.本文选取国内一家高新技术制药企业进行案例研究,基于人才盘点的相关理论,进行人才盘点方案设计,并应用于案例企业的管理干部培养体系中.实践证明...     

A Marriage of Large and Small: R & D for Healthcare Products

The most critical factor for success in the pharmaceutical industry is the discovery of novel drugs that treat major illnesses for which there had been, up to then, only inadequate kinds of treatment. Until a decade or so ago, most drugs were discovered through the in-house research of major pharmaceutical companies. But now these major companies are increasingly relying on small firms and academia for drug discovery, while concentrating on their core competences of drug development and marketing. A similar pattern is emerging in other parts of the healthcare industry. This article discusses the synergy between small and large firms in healthcare and suggests that this pattern may become a general one for all innovative industries.     

AIDS Policy and Pharmaceutical Patents: Brazil's Strategy to Safeguard Public Health

Developing nations are challenged to strike a balance between their patent obligations as members of the World Trade Organisation (WTO) and their drug pricing strategies. The Brazilian approach to pharmaceutical price negotiations has been strikingly effective. Describing the context of the Brazilian pharmaceutical sector, their public health system and the Brazilian AIDS policy, this paper examines the Brazilian strategy vis‐à‐vis the international pharmaceutical manufacturers to explore why their tactics were successful and the potential for wider application by other developing countries.     

Stakeholder Relationships,Engagement, and Sustainability Reporting

The concept of sustainability was developed in response to stakeholder demands. One of the key mechanisms for engaging stakeholders is sustainability disclosure, often in the form of a report. Yet, how reporting is used to engage stakeholders is understudied. Using resource dependence and stakeholder theories, we investigate how companies within the same industry address different dependencies on stakeholders for economic, natural environment, and social resources and thus engage stakeholders accordingly. To achieve this objective, we conducted our research using qualitative research methods. Our findings suggest that the resource dependencies on different stakeholders lead to development of different stakeholder relationships and thus appropriate resources within the company to execute engagement strategies that are informing, responding, or involving. Our research explains why diversity exists in sustainability disclosure by studying how it is used to engage stakeholders. We find that five sustainability reporting characteristics are associated with the company’s stakeholder engagement strategy: directness of communication, clarity of stakeholder identity, deliberateness of collecting feedback, broadness of stakeholder inclusiveness, and utilization of stakeholder engagement for learning. Our study develops the literature by providing insight into companies’ choices of stakeholder engagement strategy thus explaining diversity in sustainability reporting based on the characteristics and relationships with specific stakeholders.     

Older is better: Consumers prefer older drugs

Despite increasing research attention to healthcare marketing in academia and the concerted effort of the pharmaceutical industry to market its latest products, limited research has explored the effect of launch time on individuals' drug choices. Building upon findings in medical literature that many newly launched drugs are indeed no better than existing ones, this study found that the majority of consumers consistently prefer older drugs when both options are claimed equally safe and/or effective. The reason is that consumers disregard declarative information and, instead, make their own inferences. Although there is a small segment that chooses the newer option for what they infer to be its higher efficacy, most consumers believe that an older drug is both safer and more efficacious. Further, promotion-focused consumers are more likely to choose newer drugs. The underlying mechanism for how promotion focus affects choice is identified. A sample of practicing doctors cross-validated our findings, which have implications for practitioners in the pharmaceutical industry.     

Ethical Issues in Outsourcing: The Case of Contract Medical Research and the Global Pharmaceutical Industry

The outsourcing of medical research has become a strategic imperative in the global pharmaceutical industry. Spurred by the challenges of competition, the need for speed in drug development, and increasing domestic costs, pharmaceutical companies across the globe continue to outsource critical parts of their value chain activities, namely contract clinical research and drug testing, to sponsors across the globe, typically into emerging markets. While it is clear that important ethical issues arise with this practice, unraveling moral responsibility and the allocation of responsibility is not so clear, considering that contracts, by their very definition transfer responsibility from the principal to the agent. This research provides a framework for exploring some of the ethical issues, including attributions of moral responsibility associated with Contract Medical Research. Using a theory of strategic and moral behavior, the research shows that both clients and sponsors in contract research have individual and collective responsibility to ensure that due care and diligence is exercised in the performance of clinical research. The research suggests some guidelines for stakeholder action.     

Corporate Ethical Identity as a Determinant of Firm Performance: A Test of the Mediating Role of Stakeholder Satisfaction

In this article, we empirically assess the impact of corporate ethical identity (CEI) on a firm’s financial performance. Drawing on formulations of normative and instrumental stakeholder theory, we argue that firms with a strong ethical identity achieve a greater degree of stakeholder satisfaction (SS), which, in turn, positively influences a firm’s financial performance. We analyze two dimensions of the CEI of firms: corporate revealed ethics and corporate applied ethics. Our results indicate that revealed ethics has informational worth and enhances shareholder value, whereas applied ethics has a positive impact through the improvement of SS. However, revealed ethics by itself (i.e. decoupled from ethical initiatives) is not sufficient to boost economic performance. Pascual Berrone is a PhD candidate of the Business Administration and Quantitative Methods Ph.D. program at the Universidad Carlos III de Madrid. His current research interests focus on business ethics, stakeholder theory, and various aspects of the interface between corporate governance mechanisms and corporate social responsibility. His interests also include ethical, environmental and social issues and their impact on firms' overall performance. Dr. Jordi Surroca is an Assistant Professor of Management at the Department of Business Administration at the Universidad Carlos III de Madrid. He holds a PhD in Business Administration and a Licentiate Degree in Business and Economics from Universitat Autònoma de Barcelona. His research interests center on stakeholder management, firm strategy, innovation, and corporate governance. Dr. Josep A. Tribó is Associate Professor of Finance in the Department of Business Administration at the Universidad Carlos III de Madrid. He has a PhD in Economic Analysis from the Universitat Autònoma de Barcelona and a Licenciate Degree in Theoretical Physics by Universitat de Barcelona. His research interests are Corporate Finance and the financing of R&D. His work has been published in journals such as Applied Economics, International Journal of Production Economics.     

基于控制营销理念的药品流通渠道构建策略

在强调以"终端为王"的药品流通市场,众多生产厂家越来越重视药品流通渠道的管理,这既是控制流通成本、降低终端药品价格的需要,也是扩大市场、提高产品竞争力的需要。全文首先介绍了药品流通渠道及"控制营销"的概念,然后分析了药品流通渠道的现状及问题,最后从战略、管理、技术三个方面阐述了药品流通渠道构建策略。     

Who are the Stakeholders Now? An Empirical Examination of the Mitchell, Agle, and Wood Theory of Stakeholder Salience

Two environmental accidents in the mining industry provide the context for this study of the Mitchell, Agle, and Wood (1997, The Academy of Management Review 22, 853–886) analysis of stakeholder salience. I examine the reactions of two stakeholder groups: shareholder response is examined in terms of changing share returns and risk; management response through change in disclosure. I find the two decision-makers reacted at different times. Management responded to the first accident, though not the second. Shareholders responded to the second accident alone. My findings support the Mitchell, Agle, and Wood (MAW) assertion that stakeholder status is impermanent, and determined through the eyes of the decision-maker.