Application of options to the pharmaceutical markets : The solutions of corruption and counterfeit drugs in emerging markets

Purpose – The purpose of this paper is to apply options to the pharmaceutical markets to solute the corruption and counterfeit drugs in emerging markets. Design/methodology/approach – This article proposes a framework for using pharmaceutical options. The application of options to pharmaceuticals will enable a freer and more competitive pharmaceutical market, and assist medicine producers and hospitals using pharmaceutical options market to hedge price risk. Findings – The paper finds that it is possible, for example, to apply the theoretical framework to case studies in pharmaceutical markets. Research limitations/implications – The present study provides a starting‐point for further research in the pharmaceutical markets sector. The environment of the existing pharmaceutical markets, the implementation of pharmaceutical options, and the potential benefit of such implementation are discussed in details. Originality/value – This framework has proven to be useful in improving the pharmaceutical markets of the medical industry.