What is a drug?
A drug, or pharmaceutical, is a substance used to prevent or cure a disease or condition or to relieve its symptoms. In the United States, some medications are available over the counter while others can only be purchased with a doctor’s prescription. Medications can be taken by mouth, via a skin patch, by injection, or via an inhaler, to name the most common methods.
The pharmaceutical industry, which deals with the development and commercialization of drugs, is a key component of the healthcare sector, which is the most profitable industry in the US economy with estimated revenues of $24.4 billion. dollars in 2018. Prescription drugs are considered zero-rated goods.
A drug can also refer to an illegal or restricted substance used by individuals for recreational purposes or to get high.
Key points to remember
- Drug development and commercialization is a key part of the healthcare sector, which is the most profitable US industry with $24.4 billion in revenue in 2018.
- A new drug can be patented for 20 years after its discovery or invention.
- After 20 years, generic equivalents may be sold at lower prices.
The development of new and improved drugs, or medicationsis a complex and costly business in the United States. Some of America’s largest corporations, such as Johnson & Johnson, Pfizer, Merck and Eli Lilly, are active in researching, testing, manufacturing and marketing new drugs.
Furthermore, biotechnology has evolved in recent years as a major new branch of the drug trade. Biotechnology companies focus on Research and development (R&D) of new remedies based on genetic manipulation. The big players in the field are Amgen, Gilead Sciences and Celgene Corp.
In the United States, prescription drugs must be approved by the Food and drug administration (FDA). The agency’s Center for Drug Evaluation and Research (CDER) acts as a consumer watchdog.
How drugs come to market
On average, it takes about 10 years and costs about $2.6 billion for a new drug to make it from its initial discovery at a doctor’s office, according to an industry group. The process has five main steps, including three clinical trial phases:
In the development and discovery phase, researchers explore new possibilities. They can study the unexpected effects of existing drugs, test new molecular compounds, or create new technologies that allow drugs to work differently in the body.
In the preclinical research phase, when a potential new drug is identified, researchers determine appropriate dosages and methods of administration, side effects, interactions with other drugs, and effectiveness. They also study the absorption, metabolism and excretion characteristics of the drug.
The estimated cost of getting a new drug from the research lab to the doctor’s office is $2.6 billion.
In the clinical research phase, the company first tests the substance in the laboratory, or “in vitro”, and sometimes on animals, or “in vivo”. Depending on the result, the drug can then be tested on human subjects in clinical trials to determine if it is safe and effective.
The Phase 1 clinical trial or study is the first phase of the long and grueling drug approval process. While the primary goal of Phase 1 studies is to establish the safety profile of the investigational drug, these studies also help gather vital information about the drug’s effects and chemistry. This information can be used to facilitate the design of well-controlled, scientifically valid Phase 2 studies, the next step in the drug development process.
Phase 2 of the clinical trial process focuses on the effectiveness of the drug. Phase 3 trials are used to compare the treatment of the new drug to the currently established treatment of the medical problem. A follow-up phase 4 can be conducted to examine the effects of the drug on the population after its approval by the FDA. All phases of a clinical trial begin only after the long Research and development (R&D) of pharmaceutical companies, which can be time-consuming and costly.
A drug that passes this hurdle is submitted to CDER for review. The agency employs pharmacologists, chemists, statisticians, physicians and other scientists who perform an independent and unbiased review of the drug and accompanying documentation. This process usually takes six to 10 months.
The drug company will be allowed to sell the drug if the CDER determines that the benefits of the drug outweigh its risks. He is then responsible for monitoring reports of the drug’s effectiveness and unforeseen side effects.
Brand Name vs. Generic Drugs
Drugs sold in the United States can be brand name or generic. A brand name drug can be patented for 20 years after its discovery or invention. After the patent expires, other manufacturers can produce and market generic equivalents of this drug.
Generic equivalents are increasingly being prescribed as they become available in the United States due to their relatively low cost. Generics must have the same medicinal ingredients, and therefore the same therapeutic effects, to receive FDA approval for sale as substitutes.
The prescription drug prices was a source of great financial strain for many Americans, and so it became one of the greatest political issues of the time. Health insurance prevents many Americans from bearing the full brunt of retail drug prices, although coverage varies widely. Either way, the cost of medications is a major factor in increasing health insurance premiums.
The most expensive prescription drugs in 2019, according to goodrx.com, a healthcare website, include Actimmune, an osteoporosis treatment, at $52,322 per month; Myalept, a treatment for lipodystrophy, at $46,328 per month; and Daraprim, a pest control, at $45,000 per month.