Pharmaceutical Industry

Pharmaceutical Industry. The American pharmaceutical industry, like its older counterpart in Europe, grew out of the ancient practice of pharmacy, as commercial production gradually superseded the traditional compounding of medications by individuals. The need for medicine chests during the Revolutionary War necessitated some large‐scale pharmaceutical compounding in the 1770s, but significant manufacturing activity did not appear until about the 1820s, in Philadelphia. This growth accelerated after the Civil War with the emergence of many pharmaceutical firms in the mid‐Atlantic and Great Lakes regions, such as Squibb, Parke‐Davis, Lilly, Abbott, Upjohn, and Searle, that would soon dominate the industry. Though these and many other old firms remain in existence, mergers have obscured their origins. From the 1960s on, economic considerations shifted much pharmaceutical manufacturing to Puerto Rico.

Several factors account for the pharmaceutical industry's evolution and rapid growth. Wars and their concomitant demands on the therapeutic armamentarium stimulated the development of drug manufacturing. Advances in medical sciences and technology, especially from the late nineteenth century forward, had a major impact. Such disparate factors as urbanization, population growth, and the broader corporate model of the mass production, advertising, and mass marketing of consumer goods all played a role.

Like other comparatively young enterprises in the late nineteenth century, such as the petroleum and electrical industries, pharmaceutical manufacturers embraced scientific research to enhance both their product line and their marketing strategies. As pharmacology, bacteriology, organic and analytical chemistry, and other relevant sciences became established in the United States, some pharmaceutical companies drew upon them to improve quality control and develop new products. Not until the 1920–1940 era, however, and the industry's emergence as a global competitor, did all pharmaceutical companies rely on scientific research as a matter of course.

Beginning as early as 1902, when the government first required firms to secure licenses to produce therapeutic agents of biological origin, federal regulation played an important role in the way the industry conducted its affairs. The Pure Food and Drug Act of 1906, which required truth in labeling, applied to established pharmaceutical firms as well as to manufacturers of patent medicines and cure‐all panaceas. The 1938 Food, Drug, and Cosmetic Act, which required that a drug be certified as safe by the federal Food and Drug Administration before it could be marketed, had a much greater impact. An amendment in 1962 demanded proof of efficacy as well. The post–World War II surge of chemical treatments for mental and emotional disorders, from schizophrenia to depression, proved a boon for the pharmaceutical industry. By the mid‐twentieth century, drug companies achieved a major and profitable role in the chemotherapeutic revolution, from the laboratory to the home medicine cabinet.
See also Drugs, Illicit; Medicine; Mental Illness; Psychotherapy; Research Laboratories, Industrial.

Bibliography

Tom Mahoney , The Merchants of Life: An Account of the Pharmaceutical Industry, 1959.
John P. Swann , Academic Scientists and the Pharmaceutical Industry: Cooperative Research in Twentieth‐Century America, 1988.

John P. Swann