When your market is controlled by regulators it is worth paying attention to what they are doing.

Canadians pay $22bn on pharmaceutical drugs every year, which is a significant part of our health care budget.

This expense can be reduced by buying generic alternatives to the high-priced, brand-name drugs. The introduction of these generic alternatives is controlled almost entirely by government restrictions on intellectual property (IP) in pharmaceuticals. If the government shortens the IP restriction then generic manufacturers can introduce their alternatives more quickly and we will pay a lot less for our drugs. The drug companies argue that the exclusivity period should be extended so that they can recoup the costs of their R&D and invest that money back in to more R&D in Canada.

But a new study authored by Edward Iacobucci says there is little evidence for to support the drug companies’ stance and it’ll be interesting to see which argument the new government supports.

The Marketing thought

From a strategic marketing perspective, you have to consider the wider environment. Most markets are led by consumer behaviour and competitive actions. Pharmaceuticals is an extreme example of a market where regulatory bodies can cause great disruption so, in a market like that, the strategic marketing focus is on thought leadership within the industry.

Just a thought.

Tim

Read Michael Geist’s take: Drug-cost report will educate minister

Picture taken and licensed by EdWohlfahrt

Tagged as: competitive threat, strategy