The Impact of Technological Monopoly in Pharmaceutical Industry

What is a Technological Monopoly and how does it apply to the pharmaceutical industry?

A pharmaceutical company that has a patent on a drug is an example of which kind of monopoly?

Answer:

A pharmaceutical company having a patent on a drug is an example of a Technological Monopoly.

Technological Monopoly occurs when a company has exclusive control over a particular technology, product, or process. In the case of the pharmaceutical industry, having a patent on a drug grants the company the exclusive right to produce and sell that drug for a specific period of time.

This monopoly allows the pharmaceutical company to have a significant advantage in the market, as they are the only ones legally permitted to sell the drug. This exclusivity can lead to higher prices for the drug, limiting competition and potentially hindering access to essential medications for some individuals.

It is important to strike a balance between incentivizing innovation through patents and ensuring access to critical medications for the general public. Regulations and policies around patents and monopolies play a crucial role in shaping the pharmaceutical industry and its impact on society.