No abstract

Leading United States pharmaceutical firms have been experiencing ever increasing challenges to their business models. With United States health-care reform looming on the horizon, pharmaceutical companies face even greater pressures to commercialize novel therapeutics while responding to threats from generic competitors. The national health-care debate has been focused almost exclusively on access and cost and less on innovation and quality. Yet, innovation in cutting-edge technologies within creative business models is the best hope for firms to compete under changing market pressures. This article assesses the impact of generic drugs on the pharmaceutical industry and presents a framework to assess Pfizer's response to generic drug competitors. The research suggests specific actions by pharmaceutical companies could prove to be effective for new growth while contributing to a reduction in health-care costs for society.