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Documenting the financialisation of the pharmaceutical industry

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  • Busfield, Joan

Abstract

The aim of this paper is to explore the growing financialisation of the pharmaceutical industry from the beginning of the 1980s onwards and to consider its implications. It examines a number of features that demonstrate the increasing influence of the financial sector on the industry, including changing patterns of shareholder ownership, the importance attached to the idea of maximising shareholder value, the pay and share options given to company chief executives and other senior managers, the use of share buybacks, the increase in the outsourcing of manufacturing and of research and development, along with the growing use of mergers and acquisitions and of new forms of borrowing to fund them. The paper examines data in relation to each of these areas in turn in order to provide evidence of the growing financialisation of the industry and to highlight some of its consequences for the industry's task of developing and manufacturing medicines that enhance population health.

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  • Busfield, Joan, 2020. "Documenting the financialisation of the pharmaceutical industry," Social Science & Medicine, Elsevier, vol. 258(C).
    • Handle: RePEc:eee:socmed:v:258:y:2020:i:c:s0277953620303154
    DOI: 10.1016/j.socscimed.2020.113096
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    1. Thomas I. Palley, 2013. "Financialization: What It Is and Why It Matters," Palgrave Macmillan Books, in: Financialization, chapter 2, pages 17-40, Palgrave Macmillan.
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    Cited by:

    1. Grumiller, Jan & Grohs, Hannes & Reiner, Christian, 2021. "Increasing resilience and security of supply production post-COVID-19: from global to regional value chains? Case studies on medical and pharmaceutical products," Research Reports 12/2021, Austrian Foundation for Development Research (ÖFSE).
    2. Perry, Teresa & Bernasek, Alexandra, 2024. "Profits over care? An analysis of the relationship between corporate capitalism in the healthcare industry and cancer mortality in the United States," Social Science & Medicine, Elsevier, vol. 349(C).
    3. Susan K. Sell, 2020. "What COVID-19 Reveals About Twenty-First Century Capitalism: Adversity and Opportunity," Development, Palgrave Macmillan;Society for International Deveopment, vol. 63(2), pages 150-156, December.
    4. Jan Grumiller & Hannes Grohs & Christian Reiner, 2021. "“Increasing the resilience and security of supply ofproduction post-COVID-19” - The Case of Medical and Pharmaceutical Products," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 216, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    5. Grumiller, Jan & Grohs, Hannes, 2021. "Increasing security of supply for critical medical and pharmaceutical goods in the EU: Lessons from the COVID-19 pandemic," Briefing Papers 29, Austrian Foundation for Development Research (ÖFSE).
    6. Susan K. Sell, 2021. "21st Century Capitalism and Innovation for Health," Global Policy, London School of Economics and Political Science, vol. 12(S6), pages 12-20, July.
    7. Boutillier, Sophie & Laperche, Blandine & Lebert, Didier & Elouaer-Mrizak, Sana, 2023. "A systemic analysis of the technological trajectory at company level based on patent data: The case of Sanofi's vaccine technology," Technovation, Elsevier, vol. 124(C).

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