How does the pharmaceutical industry work?

Activities in the industry differ depending on the stage in a drug’s development. Before a drug can be marketed the industry has to demonstrate appropriate manufacturing standards and establish the drug’s risk-benefit profile (using information from toxicology and clinical trials). The prospectively collected safety and efficacy data are put before the regulatory authorities, who evaluate whether the efficacy demonstrated outweighs the risk (or potential risk).

Where the balance is favourable the drug may be approved for marketing. If it is approved, post-marketing activities include marketing for any indications agreed with the local regulatory authority and continuous safety monitoring. Additional clinical trials (phase IV) may be undertaken.

Most drugs don’t make it to the market, so their research and development costs are recouped by the few that do. More.

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