pharmaceutical industry pharmaceutical industry the pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceuticals for use as medications to be administered to patients (or self-administered), with the aim to mitigate symptoms or disease conditions, vaccinate them, or alleviate symptoms of disease or surgical or disease condition. pharmaceutical companies may deal in generic or brand medications and medical devices. they are subject to a variety of laws and regulations that govern the patenting, testing, safety, efficacy using drug testing and marketing of drugs. the global pharmaceuticals market produced treatments worth $1,228.45 billion in 2020 and showed a compound annual growth rate (cagr) of 1.8%. a drug manufacturer inspection by the us food and drug administration history main article: history of pharmacy mid-1800s – 1945: from botanicals to the first synthetic drugs the modern era of pharmaceutical industry began with local apothecaries that expanded from their traditional role of distributing botanical drugs such as morphine and quinine to wholesale manufacture in the mid-1800s, and from discoveries resulting from applied research. intentional drug discovery from plants began with the isolation between 1803 and 1805 of morphine - an analgesic and sleep-inducing agent - from opium by the german apothecary assistant friedrich sertürner, who named this compound after the greek god of dreams, morpheus. by the late 1880s, german dye manufacturers had perfected the purification of individual organic compounds from tar and other mineral sources and had also established rudimentary methods in organic chemical synthesis. the development of synthetic chemical methods allowed scientists to systematically vary the structure of chemical substances, and growth in the emerging science of pharmacology expanded their ability to evaluate the biological effects of these structural changes. epinephrine, norepinephrine, and amphetamine by the 1890s, the profound effect of adrenal extracts on many different tissue types had been discovered, setting off a search both for the mechanism of chemical signaling and efforts to exploit these observations for the development of new drugs. the blood pressure raising and vasoconstrictive effects of adrenal extracts were of particular interest to surgeons as hemostatic agents and as treatment for shock, and a number of companies developed products based on adrenal extracts containing varying purities of the active substance. in 1897, john abel of johns hopkins university identified the active principle as epinephrine, which he isolated in an impure state as the sulfate salt. industrial chemist jōkichi takamine later developed a method for obtaining epinephrine in a pure state, and licensed the technology to parke-davis. parke-davis marketed epinephrine under the trade name adrenalin. injected epinephrine proved to be especially efficacious for the acute treatment of asthma attacks, and an inhaled version was sold in the united states until 2011 (primatene mist). by 1929 epinephrine had been formulated into an inhaler for use in the treatment of nasal congestion. while highly effective, the requirement for injection limited the use of epinephrine and orally active derivatives were sought. a structurally similar compound, ephedrine, was identified by japanese chemists in the ma huang plant and marketed by eli lilly as an oral treatment for asthma. following the work of henry dale and george barger at burroughs-wellcome, academic chemist gordon alles synthesized amphetamine and tested it in asthma patients in 1929. the drug proved to have only modest anti-asthma effects but produced sensations of exhilaration and palpitations. amphetamine was developed by smith, kline and french as a nasal decongestant under the trade name benzedrine inhaler. amphetamine was eventually developed for the treatment of narcolepsy, post-encephalitic parkinsonism, and mood elevation in depression and other psychiatric indications. it received approval as a new and nonofficial remedy from the american medical association for these uses in 1937, and remained in common use for depression until the development of tricyclic antidepressants in the 1960s. discovery and development of the barbiturates diethylbarbituric acid was the first marketed barbiturate. it was sold by bayer under the trade name veronal. in 1903, hermann emil fischer and joseph von mering disclosed their discovery that diethylbarbituric acid, formed from the reaction of diethylmalonic acid, phosphorus oxychloride and urea, induces sleep in dogs. the discovery was patented and licensed to bayer pharmaceuticals, which marketed the compound under the trade name veronal as a sleep aid beginning in 1904. systematic investigations of the effect of structural changes on potency and duration of action led to the discovery of phenobarbital at bayer in 1911 and the discovery of its potent anti-epileptic activity in 1912. phenobarbital was among the most widely used drugs for the treatment of epilepsy through the 1970s, and as of 2014, remains on the world health organizations list of essential medications. the 1950s and 1960s saw increased awareness of the addictive properties and abuse potential of barbiturates and amphetamines and led to increasing restrictions on their use and growing government oversight of prescribers. today, amphetamine is largely restricted to use in the treatment of attention deficit disorder and phenobarbital in the treatment of epilepsy. in 1958, leo sternbach discovered the first benzodiazepine, chlordiazepoxide (librium). dozens of other benzodiazepines have been developed and are in use, some of the more popular drugs being diazepam (valium), alprazolam (xanax), clonazepam (klonopin), and lorazepam (ativan). due to their far superior safety and therapeutic properties, benzodiazepines have largely replaced the use of barbiturates in medicine, except in certain special cases. when it was later discovered that benzodiazepines, like barbiturates, significantly lose their effectiveness and can have serious side effects when taken long-term, heather ashton researched benzodiazepine dependence and developed a protocol to discontinue their use. insulin a series of experiments performed from the late 1800s to the early 1900s revealed that diabetes is caused by the absence of a substance normally produced by the pancreas. in 1869, oskar minkowski and joseph von mering found that diabetes could be induced in dogs by surgical removal of the pancreas. in 1921, canadian professor frederick banting and his student charles best repeated this study and found that injections of pancreatic extract reversed the symptoms produced by pancreas removal. soon, the extract was demonstrated to work in people, but development of insulin therapy as a routine medical procedure was delayed by difficulties in producing the material in sufficient quantity and with reproducible purity. the researchers sought assistance from industrial collaborators at eli lilly and co. based on the company's experience with large scale purification of biological materials. chemist george b. walden of eli lilly and company found that careful adjustment of the ph of the extract allowed a relatively pure grade of insulin to be produced. under pressure from toronto university and a potential patent challenge by academic scientists who had independently developed a similar purification method, an agreement was reached for non-exclusive production of insulin by multiple companies. prior to the discovery and widespread availability of insulin therapy the life expectancy of diabetics was only a few months. early anti-infective research: salvarsan, prontosil, penicillin and vaccines the development of drugs for the treatment of infectious diseases was a major focus of early research and development efforts; in 1900, pneumonia, tuberculosis, and diarrhea were the three leading causes of death in the united states and mortality in the first year of life exceeded 10%. in 1911 arsphenamine, the first synthetic anti-infective drug, was developed by paul ehrlich and chemist alfred bertheim of the institute of experimental therapy in berlin. the drug was given the commercial name salvarsan. ehrlich, noting both the general toxicity of arsenic and the selective absorption of certain dyes by bacteria, hypothesized that an arsenic-containing dye with similar selective absorption properties could be used to treat bacterial infections. arsphenamine was prepared as part of a campaign to synthesize a series of such compounds and found to exhibit partially selective toxicity. arsphenamine proved to be the first effective treatment for syphilis, a disease which prior to that time was incurable and led inexorably to severe skin ulceration, neurological damage, and death. ehrlich's approach of systematically varying the chemical structure of synthetic compounds and measuring the effects of these changes on biological activity was pursued broadly by industrial scientists, including bayer scientists josef klarer, fritz mietzsch, and gerhard domagk. this work, also based in the testing of compounds available from the german dye industry, led to the development of prontosil, the first representative of the sulfonamide class of antibiotics. compared to arsphenamine, the sulfonamides had a broader spectrum of activity and were far less toxic, rendering them useful for infections caused by pathogens such as streptococci. in 1939, domagk received the nobel prize in medicine for this discovery. nonetheless, the dramatic decrease in deaths from infectious diseases that occurred prior to world war ii was primarily the result of improved public health measures such as clean water and less crowded housing, and the impact of anti-infective drugs and vaccines was significant mainly after world war ii. in 1928, alexander fleming discovered the antibacterial effects of penicillin, but its exploitation for the treatment of human disease awaited the development of methods for its large scale production and purification. these were developed by a u.s. and british government-led consortium of pharmaceutical companies during the second world war. early progress toward the development of vaccines occurred throughout this period, primarily in the form of academic and government-funded basic research directed toward the identification of the pathogens responsible for common communicable diseases. in 1885, louis pasteur and pierre paul émile roux created the first rabies vaccine. the first diphtheria vaccines were produced in 1914 from a mixture of diphtheria toxin and antitoxin (produced from the serum of an inoculated animal), but the safety of the inoculation was marginal and it was not widely used. the united states recorded 206,000 cases of diphtheria in 1921 resulting in 15,520 deaths. in 1923, parallel efforts by gaston ramon at the pasteur institute and alexander glenny at the wellcome research laboratories (later part of glaxosmithkline) led to the discovery that a safer vaccine could be produced by treating diphtheria toxin with formaldehyde. in 1944, maurice hilleman of squibb pharmaceuticals developed the first vaccine against japanese encephalitis. hilleman would later move to merck where he would play a key role in the development of vaccines against measles, mumps, chickenpox, rubella, hepatitis a, hepatitis b, and meningitis. unsafe drugs and early industry regulation in 1937 over 100 people died after ingesting a solution of the antibacterial sulfanilamide formulated in the toxic solvent diethylene glycol. prior to the 20th century, drugs were generally produced by small scale manufacturers with little regulatory control over manufacturing or claims of safety and efficacy. to the extent that such laws did exist, enforcement was lax. in the united states, increased regulation of vaccines and other biological drugs was spurred by tetanus outbreaks and deaths caused by the distribution of contaminated smallpox vaccine and diphtheria antitoxin. the biologics control act of 1902 required that federal government grant premarket approval for every biological drug and for the process and facility producing such drugs. this was followed in 1906 by the pure food and drugs act, which forbade the interstate distribution of adulterated or misbranded foods and drugs. a drug was considered misbranded if it contained alcohol, morphine, opium, cocaine, or any of several other potentially dangerous or addictive drugs, and if its label failed to indicate the quantity or proportion of such drugs. the government's attempts to use the law to prosecute manufacturers for making unsupported claims of efficacy were undercut by a supreme court ruling restricting the federal government's enforcement powers to cases of incorrect specification of the drug's ingredients. in 1937 over 100 people died after ingesting "elixir sulfanilamide" manufactured by s.e. massengill company of tennessee. the product was formulated in diethylene glycol, a highly toxic solvent that is now widely used as antifreeze. under the laws extant at that time, prosecution of the manufacturer was possible only under the technicality that the product had been called an "elixir", which literally implied a solution in ethanol. in response to this episode, the u.s. congress passed the federal food, drug, and cosmetic act of 1938, which for the first time required pre-market demonstration of safety before a drug could be sold, and explicitly prohibited false therapeutic claims. further advances in anti-infective research the aftermath of world war ii saw an explosion in the discovery of new classes of antibacterial drugs including the cephalosporins (developed by eli lilly based on the