Business English Listening 4: The pharmaceutical industry

by Lynch A.K.A 'The Regulator' on August 5, 2012

In today’s podcast for business English, we’re going to talk about the problems facing the pharmaceutical industry. You can download the original audio file from the BBC and all our ESL teaching friends can create a cool class with it.

Audio on the future of the industry (old but good)
BBC Podcast on problems faced by pharmaceutical companies
Article on different phases of drug testing
Article on expired patents for blobkbuster drugs

When you enter a pharmacy and look at the counter that separates you from the thousands of medicines on the other side, you probably think they have been stored there to keep addicts away from valium and other barbitautes. That is true. However, the pharmaceutical industry has managed to extract an advantage from the customers inability to look at the products available: when you go and ask for an over the counter drug like Paracetemol, for example, the pharmacy will automatically choose the most expensive – Gelocatil at approximately 3 euros, when there’s a generic version for 40 cents. Now that I’ve realised this, I always make sure I request the cheaper version.

Until I started researching the current state of the pharmaceutical industry I had no idea that this request was a classic example of a serious threat the industry faces: consumers, doctors and hospitals, are increasingly opting for generic drugs. In fact, 75% of all prescriptions in the UK are now for generic drugs which is causing the industry a headache which no amount of gelocatil can cure.

And the bad news doesn’t stop there… I would like you all to ask yourselves how long you think it takes to bring a new drug to the US market… go on, guess… how long…

A whopping 12 years. That is one hell of a TTM.

You can imagine what sort of investment that requires but what makes it worse is that there are many drugs going through this process but it’s not like they all come to market after the twelve years. Many drugs they have invested in simply don’t make it. In fact, only 1 in a 1000 drugs that enter preclinical testing enter the next phase of human testing, and then only 1 in 5 are actually approved. Therefore, the high costs of developing drugs isn’t just about the cost of one product – it’s the cost of all the other drugs that didn’t make it.

The third problem – and it’s a pretty big problem for drug companies is that they are heavily dependent on a number of star drugs like Pfizer’s anti-cholesterol treatment, Lipitor; but unfortunately, you cannot keep exclusive rights to a patent forever, and the patent expired last year. In fact, across the market, 10 important drug patents expired last year – with a total worth of 50 billion in lost revenue.

A good solution of course, would be to create drugs to take the place of those with expired patents, but despite billions invested in R&D this simply hasn’t happened. The next generation of super drugs seems far away. Eli Lilly have made little progress with their Alzheimer’s drug, Merck stopped trials on a blood thinner due to dangerous side effects and of course, Pfizer failed to find a replacement for Lipitor. Probably, us consumers are really surprised by this… even the famous drugs they do develop never seem to be discovered by design but simply by accident.

The classic example being Viagra which was originally in trials for angina. The trial was unssuccsesful in treating angina but when researchers had a number of chats with red faced, embarrassed men who spoke of an unusual side effect… they realised they had a drug for something quite different. If drug companies invest billions in R&D and they have to discover things by accident… it’s not a good sign.

Thanks for listening. See you next week.

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