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How It All Began

Commodity futures trading, as we know it today, came about for the first time in Japan in the 17th century, where rice was trad

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

ed in future contracts. It was a period when farmers and buyers came together and decided to commit to each other future prices negotiated on sui

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

table terms in exchange of grain for money. For example, a dealer would agree to buy a ton of rice at the end of the next month for a certain pri

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

e from a farmer. This would be ideal for both parties, as the farmer would know how much he would get for his rice in advance, and the buyer coul

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

d plan to raise the money he needed for the purchase. Contracts such as these became more and more popular and common, and were even used as coll

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

teral for taking loans. If the buyer could not take delivery of the rice, he could sell the contract to someone else. On the other hand, if the f

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

armer could not deliver the goods, then he could hand over the contract to another farmer. Thus began commodity futures trading, as we know it to

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

ay.

What Are Commodity Futures?

Today, most of the futures commodity trading exchanges are set up in a similar way. Members of the exchange do

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

the actual trading on the floor. Stock stands for equity in a public company, and can be held as long as you want, whereas commodity futures tr

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ding contracts have a specified life. In the past, people used commodity futures trading methods generally to hedge risks and fluctuation in pric

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

es, or to take advantage of them, and not for actually buying into the commodity. The idea is that a contract requires delivery of the commodity

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

within a certain predefined time period unless it becomes null and void. The person buying the commodity futures trading contract agrees to buy t

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

e specified commodity at a fixed price on a certain date. The person selling the commodity futures trading contract agrees to sell the commodity

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

at a certain price on a certain date. As time goes on, the contract price fluctuates, and this brings about profit and loss in the trade. It is t

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

be noted, however that, the delivery generally doesn't take place. The contract is usually liquidated before its expiry. The entire trade is bas

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

ed on the idea that there will be no delivery, but we can speculate on the price of the underlying commodity at a future time to make money. Comm

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

dity futures trading is done all over the world now.

Different Types Of Commodities

There are many types of commodities that are traded in the

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

international market. These can be very broadly categorized into the following:

• Precious metals like Gold, Platinum, Silver, etc.,
• Me

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

als such as Aluminum, Copper, Steel, etc.,
• Agricultural products like Rice, Corn, Oils, Cotton, Wheat, etc.,
• Soft commodities such

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

as Cocoa, Coffee, Tea, Sugar, etc.,
• Livestock like porkbellies, cattle, etc.,
• Energy commodities like Crude oil, Gasoline, Gas, etc

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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