Customer Decisions

BIBLIOGRAPHY

CONCLUSIONS

The threat of new entries is limited, because of patent protection, the high cost of R&D, the high cost of marketing, and the credibility needed as a pharmaceutical company (S. Pessina, 2010). However, because of the high profits in the industry companies will continue to be attracted to it. The threat of substitute products of services is limited: only alternative therapy, health consciousness by the population and in some cases euthanasia seems to be possible substitutes (Sarah Holland, 2007). The bargaining power of customers is growing: new and existing, more concentrated customers to the industry will shape the landscape of the pharmaceutical market in Europe, and wholesalers are consolidating all over Europe. The respective governments of the European countries, the main contributors to health care spending, will continue to issue pressure on drug prices. The bargaining power of suppliers is mostly limited. Only the availability of new technologies and of the right number of highly skilled people could pose a problem.

Finally, the outlook of the future of the pharmaceutical industry was provided, from which it becomes clear that companies will play different roles in the drug producing industry. Not forgetting those ttwenty-five years ago, most medicines we use today weren't discovered yet. But today, whole categories of medicine are well served by safe, effective drugs, many of which are available over the counter or as low-cost generics. Different disease areas generate different business-model requirements. As industry leaders learn to play by new rules, they will need to experiment more radically, not just with choices about channel, breadth, and disease focus, but also with choices involving geographic scope, product and service combination, and where to play in the value chain, because it is so important to get the right medicine