Pressure From Customers For US Drugmakers

Having successfully negotiated the difficult early 1990s, whencost-containment seemed likely to damage their profitability, the rules of the game for US pharmaceutical firms appear to have changed once more; companies now face threats from a demanding customer base, according to a new study from Datamonitor, Customer Paradigms; the New Decision Makers (available through Pharma Marketletter).

The study notes that while in 1980 there were 139 major drug wholesalers in the USA, this figure has fallen by nearly 50%. Since 1992, nine of the top 20 wholesalers have been acquired by their peers. Moreover, more than 6,500 independent retail pharmacists have closed since 1985, and those left are forming group buying organizations to carry out negotiations with manufacturers.

Hospital Consolidation The hospital sector too has undergone significant consolidation, with major regional health care players often providing a full spectrum of primary and secondary care. The use of GBOs to negotiate the purchase of drugs is also very common, adding to the leverage of the sector.