Which Is The Most Profitable?

By Author: Steven Johnson
Total Articles: 490
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Capitalism is a wonderful invention. Although there's always some interest in the product and its quality, the real focus is always on the amount of profit being made. Businesses look at the bottom line and, based on market share, assess whether the prices can be increased. In the pharmaceutical industry, no one really cares about "doing good". Yes, we are the potential patients but, when the columns of figures are added up, the only question is whether we had the money to pay. Indeed, there's increasing concern as some of the new designer drugs are targeted at less common diseases where higher prices can be justified. In a crowded market where there are competing products, prices are driven lower. It's therefore bad business to spend a lot of money promoting brands in these markets.

All of which brings us to some new figures. As it stands, the little blue pills have been the leading drug in terms of pure profit. While every manufacturer has to recover its research and development costs, the actual cost of the chemical ingredients and manufacturing is low, and Pfizer has been making the largest percentage profit from ...
... any drug. This is all about to change. Even though it's only available legally in a few US states, the profit from medical marijuana is significantly greater than for any manufactured drugs. This arises from the basic nature of the product. It's farmed and, once in production, seeds can be gathered for the next crop. This year, the pharmaceutical industry is projecting that sales of medical marijuana will exceed $1.7 billion.

It's perhaps an interesting reflection on our culture, but the US is the largest consumer of marijuana in the world. This produces an interesting pressure on states. As we go through continuing hard times following the recession, the deficits are rising. With fewer people in work, tax revenues have been falling. Except, that is, in the states where there's a sales tax on medical marijuana. Indeed, such has been the revenue boost, it's predicted there will soon be a rush from other states to legalize its distribution. Why should this happen? Well, when you compare marijuana with alcohol, it comes out safer and more effective as a medicine. People routinely die of alcohol poisoning and the damage to the liver and other parts of the body make it dangerous. No one ever died from a marijuana overdose and it's not physically addictive, being in the same class as the synthetic opioids and other painkillers routinely prescribed to people.

None of this suggests this will affect Viagra's market share. Marijuana is used for pain management, whether as an infusion or smoked. Indeed, the fact it's more often inhaled may offer an interesting choice to the tobacco industry. At present, it's under pressure from the health industry as a cause of cancers. Perhaps it could turn over some of its production to marijuana. Meanwhile, Viagra will be fighting off competition from the generic manufacturers as its patent ends in 2012. Taking the overview, the days for Pfizer as the top profiteer are almost certain to come to an end during the next twelve months. That doesn't change the effectiveness of the little blue pills. They are still the best treatment for erectile dysfunction.