The pharmaceutical market: a transdisciplinary description of concepts and their implications

The pharmaceutical industry has delivered innovative therapies that substantially improved health outcomes. However, concerns persist regarding high drug prices and delays in the entry of competitors. This article provides a comprehensive and transdisciplinary overview of the pharmaceutical market. References were identified and selected from Medline, Lilacs, Embase, and Google Scholar until thematic saturation. Particular attention is devoted to the market for monoclonal antibodies (mAbs), given their high prices and expanding commercial relevance.

The industry is heavily dependent on innovation, with firms investing significant resources in risky R&D and charging high prices for new technologies. Although companies justify elevated prices based on R&D expenditures, additional market dynamics also sustain high pricing. Operating under imperfect competition, pharmaceutical products often exhibit characteristics of merit and credence goods, while practices such as evergreening and reverse payments reinforce market power. Patients' willingness to pay, especially for life-saving treatments, remains high despite limited understanding of expected outcomes due to informational asymmetry.

Drug prices reflect the interaction of market structure, R&D investment, licensing arrangements, and patient behavior. Biopharmaceuticals entail added complexity and cost. Monopolistic or oligopolistic conditions can result in suboptimal pricing and unmet demand, highlighting the need for stronger regulatory oversight.