Wondering what big crisis is occurring within the pharmaceutical industry today? One of the biggest events occurring within the pharmaceutical industry today is the Euro crisis. The Euro crisis is set to negatively affect pharmaceutical companies across the globe. The government’s ongoing price cuts are predicted to slash European revenues by 300 million and has set everyone into a panic. As a result, multiple countries and drug makers are taking action to save themselves from a drastic loss in revenue.
All countries rich or poor are taking precautions during this time of crisis. Many countries have been watching and cutting their spending on pharmaceutical products. France has cut their budget, Greece lowered drug prices by 27% on average, and Germany has created a prove-your-worth system for new medications. All methods of price reduction made by France, Greece, and Germany should hopefully prove to be successful in reducing the hit of the euro crisis. Because of this crisis many public health systems are not paying their bills, which is hurting the drug makers. As a result of countries cutting their expenses on pharmaceutical products and health systems not paying their bills, drug makers have made some changes to save their skins as well.
Many drug companies have been taking precautions during this euro crisis. The pharmaceutical company Bayer is building a $5 billion liquidity cushion in order to brace the hard hit they are expecting from the euro crisis and Mereck has made some changes as well. Mereck not only is trying to control their expenses but they are also trying to work with the European government in the hopes to control and reduce the price cuts which have become such a serious threat to the pharmaceutical industry. Possibly with the help of pharmaceutical companies working with the government a reasonable agreement can be established and the euro crisis will end soon.
Hopefully this euro crisis is not set to last very long and with the precautions that everyone has taken that no one is hurt to badly and can come back from this hit they are all about to take.
~ Zenas
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Recently, Italy has been in big trouble. Along with its political instability and turbulence, Italy cannot assure the stability of its own financial system, which puts the entire "eurozone" at very high risk. Italy's default would almost guarantees defaults by Spain, Portugal, and possibly Ireland. Officials claim a one in four chance of this disaster happening, which will cause disaster to the "eurozone" and bring the US into a recession again, not to mention the pharmaceutical industry.
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