Pharmaceutical Industry deals with the manufacturing of medicines, which are used for the treatment of infection and diseases across the world. This is the most important business sector, which needs special care, as the medicines are used to treat the patients and bring them back to life. It helps developing, producing and marketing the approved medicines and drugs. The companies have to abide by different laws and regulations, which are made for the protection of the patients and use them in good manner. Thousands of people want to do this business and they consider it most profitable business but they do not become successful because of their lack of skills in PESTEL analysis. If a correct PEST analysis is carried out then it can help to understand the environment to carry on this business (Academic Sample Papers, 2015).

Political Factors

To control the manufacturing of medicines and drugs, the governments make the rules and regulations and they companies have to follow them. The governments make their drug regulatory authorities, which supervise and implements the necessary regulations of drug control and they also regulate the operation of export and import of medicines and drugs, production and export of finished drugs, their sales and pricing (Mohammad Nayeem, Robaka Shamsher, 2011).

The governments have to focus on the political pressure on the pharmaceutical industry and want to make them safe for the use of patients. The provision of medicines and their effective use and availability to the patients are the primary concerns of any government. When government start taking action or make the regulation, they should mention what sort of pressure is there, which insist them to take such action to control the medicine. They should also ensure the provision of all types of medicines to all of the people as the expensive medicines are not provided in the general hospitals for the treatment of common people. It is primary duty of any government to take care of the health of its citizens and provides necessary medical treatment, access to specialists and use of latest and modern technology for the diagnosis of the diseases (Alan Shaw, 2011).

Economical factors

The economic situation in the country affects the pace and development of this industry. If there is economic crisis in the country, then the spending on healthcare per capita is increased. The consistent increase in homecare shows that nursing services shift their working to private sector. The countries, which use health insurance models to make the part payment, they are affected by reduction in consumer disposable income. When the strategic buying groups look the economic pressures, they force to cut down the prices of the medicines (Alan Shaw, 2011).

The economic conditions of most of the countries across the world are not good and they are facing economic recession, which is appeared after a long time. The countries are getting support from other countries, whose economy is strong so that they can manage their business well and they can face the economic disaster effectively. They stopped funding in small and less important projects and now they are focusing only on the big and most important projects to save the money and continue economic growth within the country. Most of the less developed countries stopped buying the expensive medicines but it has bad impact on the health conditions and average life span of the people, which is decreasing drastically (Mohammad Nayeem, Robaka Shamsher, 2011).

Social Factors

There are different social and cultural factors, including poverty, malnutrition, obesity and expansion of diabetes are the growing concerns for this pharmaceutical industry. These unhygienic health conditions are affecting the eruption of the diseases like malaria, tuberculosis and other preventable diseases. This industry is also facing other issues like poor sanitation, drinking, smoking, and poor oral hygiene create serious threats to the industry (Academic Sample Papers, 2015).

Now people are well informed about healthcare activities and they are concerned with different health issues and increase in the aging population is creating various threats to the industry and they need to solve their issues before becoming them worse. They need to focus on the research and development sector to find the proper solutions of their health concerns (Alan Shaw, 2011).

Technological Factors

Most of the pharmaceutical countries are using the advanced technologies in manufacturing of medicines and drugs. The use of IT technology in the preparation of the drugs is becoming most important and they carry out different research and development work and it has help the industry for improvement of medicines (Academic Sample Papers, 2015).

The improvement in technology has create new business prospects and in the coming time, new therapy systems and services will provide information for the healthcare products and it will also help in customize treatments and direct to patient advertising (Alan Shaw, 2011).

Environmental Factors

There is growing concern over the environmental issues and the stake holders are becoming more aware about the need for the business and they are taking some proactive steps. They are taking steps to enhance their business and marketing plans and link them with different environmental issues. They have started different Corporate Social Responsibility programs and take the opportunity to product development, which can identify eco opportunities to promote these products and this business. The industry has to follow the instructions and regulations of the governments while spreading their business in the markets (Alan Shaw, 2011).

Legal Factors

Most of the pharmaceutical industries look on the legal aspects of the industry and they follow the rules and regulations while doing their business in the market. They have legal aid, which can help them to curb the external challenges in the industry. Various countries and the pharmaceutical companies are taking steps in generic drug production and they are introducing new health reforms in the pharmaceutical industry, which can help them in understanding their issues and mitigating their issues amicably. Some countries face the pressure from the firms and they have to introduce new reforms in solving their concerns and meeting their demands, which are facing during their business. It is also necessary to meet the legal issues of the import and export of the drugs and has to pay the taxes and other duties. They also ensure proper use of the medicines and prevent the issue of highly sensitive medicines to unauthorized persons (Academic Sample Papers, 2015).


Alan Shaw (2011), A PESTLE Analysis for the Pharmaceutical Industry, available at

Mohammad Nayeem, Robaka Shamsher (2011), A Study on the Impact of PEST Analysis on the Pharmaceutical Sector: The Bangladesh Context, available at

Academic Sample Papers (2015), PESTEL Analysis for Pharmaceutical Industry, available at

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