Brand-name medicines are prescription pharmaceuticals that are protected by patents or other forms of exclusivity. These medicines must first gain approval from a country’s regulatory authority. Applications for approval typically includes documentation that establishes the clinical safety and efficacy of the medicine. Once approval is received, the innovator company can then exclusively market and sell the “brand-name” product, for as long as they have patent protection or market exclusivity.
Developing new medicines can take years and significant investment. Only a few promising therapies ever enter clinical trials. Fewer still are approved for sale by health authorities, at which point marketing to healthcare providers and consumers begins.
Because patents and exclusivities can last many years, they serve as an incentive to developers. During the periods protected, developers generally recoup their investments and earn a profit.
DOP: August 2019