Japanese Government Policy in Pharmaceutical to Innovative R & D Industry

The Japanese pharmaceutical industry has been growing steadily since the 1970's. The early success, however, largely depended on technological "diffusion" including technology transfer or licensing of competitive foreign pharmaceutical products followed by development of incremental drugs which largely contributed to the early prosperity of domestic industry. Recently, transformation in distribution of major causes of death and emerging new types of diseases have been affecting the shift of the Japanese Government health care policies. Do the current Japanese health care policies promote innovative research and development in the Japanese pharmaceutical industry? Do the policies demarcate radical research and development from incremental one? This paper explores the influence of health care policies on innovative R&D in the Japanese pharmaceutical industry by answering two questions above. In such a strongly regulated industry, the effect of government policies on the decision of industry's future policies would be substantial. First, the present situation of The Japanese pharmaceutical industry is analyzed in terms of scopes, significances, and trends. Then, I investigates regulatory factors in health care policies which influence innovative R&D to identify significant barriers. Finally, I conclude the tendency and future of the health care policies for innovative R&D based on the analysis. Thesis Supervisor: Dr.Stan N. Finkelstein, M.D. Title: Executive Director, Program on the Pharmaceutical Industry