Risk Management of the Pharmaceutical Companies |Biomedgrid

Compared with other industries, the pharmaceutical industry is driven by R&D and high regulations, as well as increasing product complexity and quality requirements [1]. Indeed, it usually takes more than 10 years for a new flagship drug to be successfully developed, approved, and launched into the market. Moreover, it costs at least US $1 billion to develop a new drug [2]. The long development and testing cycle, as well as the uncertain success prospects, require pharmaceutical companies to resist and manage risks. Over the years, the pharmaceutical industry has therefore been adjusting its business model to develop drugs that can be used by the widest segment of the population as possible, through a financialized approach. Indeed, ensuring the long-term profitability and revenue of a company, upon the launching of new drugs, raises serious concerns for the involved parties in the pharmaceutical industry [3]. The risks faced by pharmaceutical enterprises include patent cliff, declining market demand, and the impacts of external financial pressures.