Question

In: Economics

Using supply and demand and competitive analyses, explain what happens to a pharmaceutical company’s revenues and...

Using supply and demand and competitive analyses, explain what happens to a pharmaceutical company’s revenues and profits from an individual drug once it loses its patent protection. Then identify at least one strategy the company can use to mitigate the losses; be sure to support your suggestion using economic analysis.

Expert Solution

SOLUTION:-

* We know that the pharmaceutical company now enjoying patent protection among the US and most of their countries.

* We know that the patent protection means a right granted by the united states of america to the inventor.

* This right give the inventor to protect using.

* Selling, importing by other is punishable offence.

* The protection is different for drugs.

* The protection is always create a monopoly to the producer.

* But the protection is expires their competitor will be manufactured the drugs.

* This drug is know as generic drugs.

* So the competitor will not incur any type of cost.

* Because the drug is always a market value and demand.

* So the protection is losed by the manufactures their revenues will be decreased.

* But the demand for the product will be increased.

* But the competitor are always produce the generic versions.

* So the best challege against the competitor will reduce the production of drugs in the industry.

* Or an another strategy is invention of new drugs and enjoy the patent protection.

THANK YOU

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Rahul Sunny answered 1 year ago

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