Impact of pharmaceutical companies upon the economy and public finance in Poland: The Sanofi case study

Abstract

The paper discusses a two-channel impact of pharmaceutical companies upon the economy and public finance. Firstly, pharmaceutical companies predominantly impact the net value added, employment, income of people employed by their suppliers and customers as well as public finance revenue in the countries where they are based. The mechanisms of such an influence are presented in the input-output matrix (input-output analysis) that shows how output from one industrial sector in the economy may become an input to another industrial sector. The input-output model was developed by Leontief and earned him the Nobel Prize. This kind of influence upon the Polish economy has been illustrated with the case study of the Sanofi company. Secondly, pharmaceutical products improve the effectiveness of medical treatment, by which they contribute to the higher standard of living and economic growth.
In this part of investigation into the impact of pharmaceutical companies upon the economy the key method consists in calculating indirect costs, that is, the lost productivity (lost GDP). Non-generated GDP as well as the negative impact of diseases and the treatment thereof on public finance can be significantly reduced by using more effective pharmaceutical products. This second channel through which pharmaceutical companies exert influence on the economy has been illustrated with an example of economic consequences calculated from the social viewpoint for three gynaecological–oncology diseases. Our calculations for both channels in this exercise have led us to conclude that a pharmaceutical company positively influences its business partners and the economy while by improving the health of the population it exerts a positive impact upon the economy and public finance.