Pharmaceutical price regulation has been used in major pharmaceutical markets to correct market imperfections and contain rising healthcare costs. But regulations can affect the adoption of innovations, especially in highly regulated industries such as the pharmaceutical industry where products and processes are protected by intellectual property rights.

Direct-to-consumer advertising (DTCA) by pharmaceutical companies has always been somewhat controversial, with the US and New Zealand being the only two developed countries that allow such promotion. Direct-to-consumer advertisements in the US are broadcast on television and radio, are displayed on billboards, appear in the pages of magazines and newspapers, and are on the internet.

Some critics of the pharmaceutical industry (e.g. Angell 2005) claim that most of the new drugs launched by drug companies cost much more than older drugs but are no more effective. If this were the case, then the launch and utilisation of new drugs would not have much impact on health and longevity.

A large generation of baby boomers reaching retirement age, and a steadily decreasing dependency ratio (number of working people per retiree) in most developing countries (and not too far in the future in China and elsewhere) make the economics of healthcare an increasingly important topic in the public arena. One key issue in this area is the price of pharmaceutical products.