Since its inception, the Food and Drug act developed into the Food and Drug Administration, which is responsible for oversight and administration of the rules. Once an application to test a new drug compound has been approved, it must pass a series of tests. Only about 23% of all drug compounds that enter into Phase I ever make it through this phase and into the second phase (Scherer, 2000). This failure rate means a lot of wasted money in the research and development stages of product development. This means that the drug companies have only a slim chance to see profit from any of their ideas and efforts. The efforts of pharmaceutical companies fail many more times than they result in success. Capital investment in new drugs is risky business. Government regulation limits the company's chances for success. This factor makes the investment of initial capital for research and development...
[ View Full Essay]