Emerging Role Of Differentiated Products In Pharmaceutical Industry

The development of new drug molecules has never been easy and is full of challenges, some of which include the following:

1. The time and cost of Research and Development (R&D) involved is high.
2. Success of new drugs, like market acceptance and market capture, is quite uncertain.
3. There are Government policies to take care of patients interest thereby regulating drug prices and allowing compulsory licensing.
4. Challenges and intense competition from manufacturers of low-cost generics and me-too drugs of same therapeutic class.

Pharmaceutical industry is one of the most intensively regulated sectors and as a result of these challenges, returns on R&D investments in the pharmaceutical industry have decreased. One feasible alternative to address these challenges is to adopt strategies to reduce development costs and maximize profit. One such strategy is Product Differentiation. Product Differentiation is innovating an existing product, i.e., creating a product