Pharmaceutical Industry: Brand Name Drug Manufacturing

The United States Pharmaceutical Industry, evolutionary is responsible for the Research and Development of new drugs/drug compounds, a heightened understanding of chemical compounds within drug substances, innovation of new technological advances and an increase in treatable or curable diseases and illnesses via production of Pharmaceutical Drugs. For over a century, the United States has used various resources: time, energy, money, and sheer will-power to give consumers, universities, profit-seeking firms and regulatory agencies new advances in the Brand Name Drug market. This industry, over several decades, has widely increased its own capabilities through various avenues of research, development, and funding.

As drug therapies continue to rise, the United States continues to finance ventures through many companies. Big name Pharmaceutical companies like Pfizer and Merck have survived and prospered through this time. With the help of the U. S. Government, creating regulatory agencies such as the Food and Drug administration, consumers can rest assured the products being marketed to them are naturally safe and available to everyone who requires their use. Historically speaking, the evolution of the Pharmaceutical industry began in the late 1800’s and still operates concurrently today. Much has changed through the years, but one thing remains constant: Growth, and Innovation. The evolution of this industry can be broken down into 4 significant time periods: From the 1800s to WWII, the 1940s to the mid-1970s, the 1970s to the new millennium, and the first decade of the new century. Each time period or segment is comprised of several areas and justifications for maturation and expansion of new drugs. Since the inception of the Pharmaceutical Industry, the main goal has been and will continue to be: to develop new drugs to combat any ailment attainable. The United States heavily relied on the European Drug Industry, to provide not only the medications themselves, but also the technologies used to manufacture said medications. That was until a company named Pfizer was opened in 1849. Pfizer was founded by two cousins from Germany, Charles Pfizer and Charles Erhart. They opened Charles Pfizer & Company as a fine-chemicals business in New York. With the production of santonin, an antiparasitic, Pfizer grew successful. With the impending Civil War, the demand for painkillers, preservatives and disinfectants quickly grew. “Pfizer expands production of tartaric acid (used as a laxative and skin coolant) and cream of tartar (effective as both a diuretic and cleansing agent) as well as other vital drugs to help meet the needs of the Union Army”. Meeting the needs of the Union Army, Pfizer successfully increased their productions, increased their employed labor force, all to accommodate growth and demand. With a steady development of new products Pfizer became a household name, and is still one of the Top Pharmaceutical Companies in the United States.

Throughout the years following the Civil War, numerous drugs were manufactured and developed: Aspirin, Insulin and Penicillin to name a few. Each were pioneers; they saved numerous lives and are still used widely today. With the inception of Aspirin came the issue of Patents, and trademarking products. Bayer was the first to patent Acetylsalicylic Acid (ASA), in the United States and Britain. However, “the U. S. government seized Bayer's American operations as enemy property and auctioned them off to Sterling Products, a patent-medicine outfit. Sterling mainly purchased the exclusive right to use the terms "Bayer" and "Aspirin" in the United States, for ASA's patent had expired in 1917”. As Aspirin became a World known commodity, various companies began producing and advertising it under “pseudonyms”, most notably Sterling. Sterling produced a compound of mainly ASA under the name Anacin, where it was then advertised and market to consumers with underlying statements of pain and tension relief. These statements were partially true and as a result “the Federal Trade Commission (FTC), the overseer of drug advertising, began a 20-year campaign to attack these unfounded claims and omissions”. The untrue statements divulged by Sterling led lawmakers to intensified regulation and required research to prove and claims due to the introduction of the Food, Drug and Cosmetic Act of 1938.

The Food, Drug and Cosmetic Act of 1938 was implemented to ensure regulation over medical devices and cosmetics, in addition to drugs. It amended the previous Food and Drug of 1906 and now required that drugs be labeled with safety instructions as well as adequately relevant information for consumers. In addition, it mandated a pre-market approval through the FDA, to determine the safety compliance of the drug. “It irrefutably prohibited false therapeutic claims for drugs, although a separate law granted the Federal Trade Commission jurisdiction over drug advertising”. This Act would lead the United States into one of the greatest eras of Pharmaceutical Innovation: the World Wars.

Once the United States experience the aftermath of the Second World War, the need for antibiotics and pain relief intensified. “Nearly every government in the developed world began to support publicly funded health related research”. With funding provided, researchers were able to vastly study the mechanisms and underlying causes for disease. “This explosion of research enormously increased medical knowledge and provided firms with rich opportunities for innovation”. Previously, the methodology used for researching new drug compounds was vastly unadvised. Researchers would use a methodology called, ‘drug screening’, where thousands of drugs were combed through before finding ones of therapeutic value. Malerba and Orsenigo (2015) described this in relative terms as representing the lottery, the compounds were happened upon via sheer coincidence. One compound in particular, Streptomycin was studied heavily following these years of drug screening. Streptomycin was a promising antibiotic used to treat against tuberculosis. The use of Streptomycin for research leads to the innovation of study design. While the United States had an ample supply of this antibiotic, the research yielded less conclusive data. Meanwhile, British scientists, Hill and Colleagues were performing experimental treatments with a true randomized study due to lack of the drug. “When the results of his study were published in 1948, Hill's use of concurrent controls (randomized, controlled) was praised as having ushered in "a new era of medicine". With the information gained from Hill’s study, American scientists began mapping out generalized criteria for drug testing. More specifically the stages which drug development should proceed. “Patients were to be selected through formal criteria and then randomly separated into treatment and control groups; trials were to be double-blinded and employ objective diagnostic technologies; and drug doses were to be administered according to a fixed schedule, while patient observations were to be charted at uniform intervals”. This lead to an increase in clinical trials, and an increase in Federal Funding to enhance medical research and innovation. The basis for the Industry transformation was laid out: Innovation and Research and Development were to be the main focus of the Pharmaceutical Companies. “The rate of innovation began to soar: the R&D to sales ratio rose from 3. 7% in 1951 to 5. 8% in the 1950s to around 10% in the 1960s, reaching around 15-20% in the 1980s and afterwards”.

In the years following the increase in Research and Development, hundreds of new chemical entities and several important drug classes were discovered. These ranged from antipsychotic drugs to antibiotics to diuretics and so on. During the years leading up to the 1970’s, the United States population was blossoming and the demand for pharmaceuticals growing with it, giving way to increased innovation and industry growth. At this time, Thalidomide was presented to the public as a miracle drug. Thalidomide was discovered by Wilhelm Kunnz in 1953, it was first synthesized by Chemie Grünenthal, a pharmaceutical manufacturing company. Thalidomide was given to consumers in 1956, and marketed as a cold and flu medication trademarked as Grippex. This drug along with Contergan were campaigned to several top-line medical publications along with letters to physicians, where sales reached 90, 000 units and were sold to over twenty countries, excluding the United States. With the large volume of sales and insufficient studies showing side effects - numerous men, women and children used these drugs without knowing the harmful effects. Thalidomide abnormalities were first noticed in the newborns of mothers who used Thalidomide during pregnancy. These abnormalities included “hearing loss, ocular alterations, deafness, facial paralysis, malformations in the larynx, trachea, lungs, and heart, and mental retardation in 6. 6% of affected individuals”. “The mortality rate among the victims ranged from 40% to 45%. Around the world, between ten and 15 thousand children were born with the characteristic abnormalities associated with thalidomide, and 40% died during the first year of life”. This tragedy unfolded, and resulted in different practices within the United States and Germany. “Thanks to Frances Kelsey, the drug was not approved by the FDA, under the argument that the testing was insufficient”. Since Thalidomide was not approved and released by the FDA for use within the United States, the country was inexperienced with its effect. The Thalidomide tragedy experienced by other countries and thousands of people did not leave the United States unaffected, it became the FDA’s main focus to increase the safety of drugs consumed by people. Due to the lack of communicated information and knowledge of adverse effects caused by Thalidomide, the FDA established a new form of regulation: the Investigational New Drug Procedure. This was used to develop and monitor the use of clinical trials on new drugs to determine the safety and efficacy of these new drugs. “New regulations prohibited testing a drug in humans until preclinical studies could predict that the drug could be given safely to people”. This would be known as the 1962 amendment to the Food, Drug and Cosmetic Act of 1938. The language, added as an amendment, displayed criteria for assessing the efficacy of a new drug. It was stated that ‘substantial evidence’ be presented to the FDA for approval. However, it was not particularly stringent. “New drugs did not have to be superior to other drugs on the market nor did "substantial evidence" mean evidence "so strong as to convince everyone". With the amendment leaving many unanswered questions regarding the amount and quality of evidence, led many scientists to search for more answers. Research was the avenue to the answer, and scientist knew searching for it would give rise to a surplus of knowledge.

Biotech Revolution (1970s to the new Millennium) began from direct lines of funding from the public. Research and education greatly benefited from the increase in funding by providing many readily available resources to bridge previous gaps in discovery of specific therapeutics verse random screening of drugs. During this time period there was an immense desire to understand the function and mechanisms of various drugs. The initial birth of this era is recognized by the inception of Genetech in 1976, which was the first company of its kind: a specialized biotechnology company. With the realization that much was still undiscovered and chance for advancement was high, this was evidence of a time numerous new companies began to emerge in the industry. This buildup was recognized as a transformation within the industry, marked by competitiveness, venture capital and Intellectual Property Rights (IPR) regime. “Intellectual property rights are the rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time” (World Trade Organization). This signified at time where companies were not relying on patents and trademarks to protect their investments or ideas. This greatly helped as a majority of the research work being conducted during this era was funded by the public. Thus, saving money to fund more research in the long run. Lastly, this era signified an adoption of Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). This occured in 1994. Which allowed for the extension and homogenised patent protection to all countries who participated in the World Trade Organization. Notably during this agreement the patent protection was extended to 20 years.

Finally this era adopted a crucial development step: the Waxman-Hatch Act of 1984, which significantly reduced the safety controls on generic drugs. Proclaiming generics drugs were equivalent to the brand name drug. Thus allowing for the production of generic drugs in such a way to be more cost-effective, and allowing for the much reduce cost to the consumer as well. Ending the Biotech revolutionary era with sky high economic statuses, the next era noticed the fall of those statuses. From the late 1990s to today has displayed much of a drastic change, and the decline in innovation. This the decline in innovation lead to the positive consumer and public opinions of the industry to slowly dwindle as well. The market noticed a large media presence outcasting the mand disputes over intellectual property rights as well as the price of the drugs on the market. “Given the current rate of scientific and technological progress, large corporations realised that they could not solely rely on their internal knowledge to discover and develop new drugs”. Many of the big pharma companies reacted to this realization by using mergers and acquisitions to obtain new resources. Thus, the consumer saw market changes, but none adding too much significance. Many of the recently integrated companies were merging or being purchased by the large pharma corporations such as Sanofi, Johnson and Johnson and even Pfizer. Big pharma, was still leading the industry in research, discovery and development. For over a century the Pharmaceutical Industry along with the development and manufacturing of pharmaceutical drugs has been recognized for its growth, innovation and for its beneficial outputs for each and every American. The industry as whole has been financially profitable for its entirety with great help from public and federal funding allowing for continued research, education and development of new and previously discovered chemicals compounds and drugs. Many years of transformative regulations and Governing bodies have allowed for the United States to safely acknowledge people can and will be provided with safe and essential medications.

One of the many Federal Food and Drug Administration’s jobs is to ensure the safety and effectiveness of the drugs available to consumers, each and every day that job is fulfilled to the best of its abilities due to the numerous reformations and trials, errors and stumbled upon discoveries by the foundational scientists. These scientists believed in more, and never stopped searching, discovering and developing more for the advantage of the people.