Business Barriers to Entry

Barriers to Entry

Patents are granted for 20 years, but pharmaceutical companies cannot  use their patent-guaranteed monopoly powers for anywhere near this long  because it takes several years to acquire Food and Drug Adminstration  (FDA) approval of drugs.

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  • What purposes do barriers to entry created by the government serve?
  • What are other barriers to entry in the pharmaceutical industry?
  • Should drug patents be extended to 20 years after FDA approval?
  • Explain what would be the costs and benefits from this extension.

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