The pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceutical drugs for use as medications. 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 and marketing of drugs.

The modern pharmaceutical industry traces its roots to two sources. The first of these were local apothecaries that expanded from their traditional role distributing botanical drugs such as morphine and quinine to wholesale manufacture in the mid 1800s. Rational drug discovery from plants started particularly with the isolation of morphine, analgesic and sleep-inducing agent from opium, by the German apothecary assistant Friedrich Sertürner who named the compound after the Greek god of dreams, Morpheus. Multinational corporations including Merck, Hoffman-La Roche, Burroughs-Wellcome (now part of Glaxo Smith Kline), Abbott Laboratories, Eli Lilly and Upjohn (now part of Pfizer) began as local apothecary shops in the mid-1800s. By the late 1880s, German dye manufacturers had perfected the purification of individual organic compounds from coal tar and other mineral sources and had also established rudimentary methods in organic chemical synthesis.[2] 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.

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