Nobody downloaded yet

Drug Companies Monopolies, Profits and Ethics - Essay Example

Comments (0) Cite this document
This article will explore the subject of drug companies monopolies, profit and ethics under the following divisions: patents make the monopoly in drug companies; drugs are available at lower prices in developing countries; prime profits of drug companies; ethics of drug companies…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER94.9% of users find it useful
Drug Companies Monopolies, Profits and Ethics
Read TextPreview

Extract of sample "Drug Companies Monopolies, Profits and Ethics"

Download file to see previous pages This research will begin with the statement that in this present era, consumers are forced to spend a huge amount of money for buying prescribed and brand-name drugs. This is because all big pharmaceutical companies are allowed to charge whatever they want from the consumers. These companies possess the patent rights due to which they can easily stop the competition in the market and can set the price at its highest level. The drug companies’ monopolies refer to the situation where big companies are controlling the sale of the brand-name drugs. These drugs are becoming the most expensive component of the health care expenses. According to the research, Americans are now spending more than $500 billion annually to buy prescription drugs. These monopolies can be categorized as the government made monopolies. Actually, whenever the big pharmaceutical giant makes a new drug, it applies to the government to possess the patent right. And after getting the patent, the company gets the right to become the sole seller of that drug for a specific time period. The researcher states that this allows companies to charge maximum prices for the patented drug and, as a result, the company can generate immense profit. These higher prices enable companies to recover its R&D cost for that particular product and also allow companies to focus on further research. But due to this monopoly, consumers have to pay a large amount of money for buying that product....
The most common price increase was related to the three types of drugs including anti-infective, cardiovascular and central nervous system drugs (Hoskins, 2012). Patents make monopoly in drug companies Patents are intellectual property rights and this is granted by the government to the company for the purpose of preventing others to copy its new invention. In the drug industry, the patent is given to the brand-name drug companies to stop competitors from selling, making or importing that particular drug. These types of restriction cause monopoly in the drug industry as few companies are controlling the sale of the drugs. This also leads to higher prices due to decreased competition. Pharmaceutical companies can easily take patent right for 20 years based on different aspects of innovative drugs. The World Health Organization program which was based on essential drugs indicated that patented drugs can only be marketed under the proprietor’s brand and this leads to more monopolies which increase price pressure on the consumers and results in generating higher profits for the drug industries (Elliot et al., ?2002). Drugs are available at lower prices in developing countries Developing countries and underdeveloped economies make similar expensive medicines with generic or alternative sources. The major reason is that the purchasing power of the consumer in these areas is very low and they cannot afford high-priced medicine. The prices of these drugs are much lesser than the original one. Moreover, they can produce the same drug with such ingredients that are not healthy but are cheap. Sometimes, they find out local herbal ingredients to make similar medicines. These medicines give relief to patients for a very short time period (Angell?, 2004). They can also import ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Drug Companies Monopolies, Profits and Ethics Essay”, n.d.)
Retrieved from
(Drug Companies Monopolies, Profits and Ethics Essay)
“Drug Companies Monopolies, Profits and Ethics Essay”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Drug Companies Monopolies, Profits and Ethics

Perfectly Competitive Firms Versus Monopolies: Inability to Make Enormous Profits

...? Perfectly Competitive Firms Versus Monopolies: Inability to Make Enormous Profits Perfectly Competitive Firms VersusMonopolies: Inability To Make Enormous Profits Introduction There are many competitive firms that offer quality products, affordable prices and good customer service. It takes a number to years for a company to create a name in the industry and a specific brand that would catch a particular following in the market. However, despite the quality products and services, these companies may not be able to make enormous profits in the long run. Stated otherwise, these competitive companies make...
5 Pages(1250 words)Essay

Monopolies and Economics

..., failure to innovate left them vulnerable to alternate suppliers. A criticism often leveled at monopolies is that they are complacent and slow to innovate. . Monopolies can be destructive to the economy because they give the firm the opportunity to be a price maker rather than a price taker. The monopoly will reduce the supply, which increases the price to the point that it maximizes profits (Parkin 110). This point is almost always at a point above the price that would be available in a competitive market. According to Stigler, "the purely "economic" case against monopoly is that it reduces aggregate economic welfare". For example: If a firm can sell...
7 Pages(1750 words)Essay

Monopolies and Oligopolies

...Monopolies and Oligopolies Monopolies are firms which are the sole source of a product, has no close substitute, and overwhelmingly dominates the market. This is the case of Microsoft as it has established itself as the only supplier of the Windows Operating System. By way of patents and copyrights, Microsoft has been able to establish a barrier of entry into the market and is thus able to eliminate competition. Though there may be other operating systems available, non are comparable to the system that consumers have become dependent on. The ability of Microsoft to dictate not only price, but also the products that are introduced, indeed make it a monopoly. Other manufacturers have...
2 Pages(500 words)Essay

Fast profits

...November 2006 Fast profits Discuss the prestige of meat in society related specifically to the time period upon when the book was written. During the late 1800s up to the early 1900s, the meat industry was highly notorious for its unsanitary measures, despite the presence of sanitary inspectors. On the other hand, eating meat then was a sign that people are able to somehow live comfortably in their own little way. The safest and graded Class A meat was bought and could only be afforded by the elite in society. Meanwhile, the rotten and diseased meat could only be afforded by the lower class, particularly those people who cannot afford to buy a decent meal to eat. Generally speaking, meat is an essential component of...
4 Pages(1000 words)Essay


...How does the demand curve faced by a purely monopolistic seller differ from that confronting a purely competitive firm? Why does it differ? Of what significance is the difference? Why is the pure monopolist’s demand curve typically not purely inelastic? Demand Curve – Monopoly and Perfect Competition: In a perfectly competitive environment, a purely competitive firm is a price taker, i.e., the price is set by the market and the firm accepts the price. Monopoly market is one where one company owns all or nearly all of the market for a particular type of product or service, i.e., a market in which there are many buyers and only one seller (Sloman and Sutcliffe, 2004). The demand curve of...
2 Pages(500 words)Essay

Justice vs Drug Companies in the USA

...Justice vs Drug Companies in the USA In recent years, the aggressive efforts of the pharmaceutical industry to direct market their drugs to health consumers has led to increased misrepresentation of product labels and advertising claims. In 2007, it is estimated that BigPharma budgeted amost $5B on the sales marketing of pharmaceutical products, all too often resulting in extravagant claims and a lack of emphasis on potential side effects of these highly touted pharmaceuticals (Frosch and Grande 2010, 1). Many experts believe that one of the most important reasons for misleading pharmaceutical labeling has to do with the tremendous growth of direct-to-consumer advertising (DTCA) over...
5 Pages(1250 words)Research Paper


...monopoly is characterized by one seller in the market, the goods being sold have no substitute and there are barriers of entry into the market by other firms. In the stated case, Microsoft’s products were highly differentiated and this strengthened its market power and economic profits increased due to the imperfect competition it created. “Barriers to entry are economic, legal or deliberate hindrances aimed at keep off new entrants/sellers from entering a market (Goodwin et al 2008, p 307). This was practiced by Microsoft when it formed restrictive licensing agreements with original equipment manufacturers in order to prevent other firms from being used in the market. This also created economies of...
2 Pages(500 words)Essay

White Paper: Ethics and Profits

...colleagues conducted a research on 94 United States based manufacturing companies and established that the factors that contribute to unethical behavior include corporate greed, internal pressure from the management as well as external pressure that comes from the investor expectations especially when the industry is doing well. This pressure makes the decision makers to fault the ethical considerations and do anything to ensure that their expectations are met (Michigan State University, 2010). This clearly indicates that there is tension between ethics and profitability. Ethics is beyond a moral vision, it provides an opportunity to make...
2 Pages(500 words)Assignment

Legal Monopolies

...Legal Monopolies The existence of monopolies in the economy presents challenges in the delivery of services, due to the inefficiencies associated with their existence. On this platform, laws geared towards the elimination of competition in most countries are illegal, but the existence of statutory monopolies challenges this perspective. Indeed, legal monopolies are those companies that operate exclusively in a market with no competition, offering goods at controlled prices. Indeed, governments pass legislations to legalize a monopoly with the initial intentions to offer the best services to its citizens, although most of them do not live...
2 Pages(500 words)Essay

Monopolies and oligopolies

...obtain more economic profit by having prices at higher possible point. These firms likewise use the economic profits from the monopoly acts to invest in development and research with resources for the company and thus hugely benefit given the diseconomies of sale. On the other hand, Oligopoly’s case is much unique since the industry has few but large firms. In this regard, if they interfere with price setting it may be a great disadvantage of the final consumer. With no competition or just little competition within the market, these few firms may not have the will to expand or improve their production to benefit their consumers. While having little to new competition in...
4 Pages(1000 words)Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Drug Companies Monopolies, Profits and Ethics for FREE!

Contact Us