The paper examines the licensing of new drugs from the viewpoint of both the license applicants and the government pharmaceutical licensing boards.   It considers risks and uncertainties that can be generated by distinct cultures and practises of licensing boards, with a focus on those in Europe,the US and Canada.  It employs the lens of the Stages of Knowledge Ahead theory of choice under risk and uncertainties to delineate the evolution of these risks through the various experimental stages, and their possible effects.
The process of marketing new pharmaceutical products involves an evolution of stages of knowledge ahead of the risks and benefits of the drug.  In the initial stages a researcher has an idea whose potential is explored typically on animals.  The cost of these initial phases is often covered partly by venture capitalists if originating outside a major pharamceutical laboratory. If the idea survives these investigations, a pharmaceutical firm may purchase the option with the aim of obtaining a government license to market the drug.  The issuance of a license  to seek to initiate a sequence of of experiments on humans.
 On humans, stage 1 involves administering the drug to a minute sample of healthy humans.  If the  idea survives this inital human investigation, stage 2 administers the drug to people suffering from the malady the drug should alleviate. If the  idea survives this further human investigation, stage 3 is a sizable experiment typically in several countries. If the idea survives this international check, the pharmaeceutical firm may seek licensing approval.  In the European Union, licensing approval is delegated by the European Union Council to individual countries on a rotation basis.  If the drug is approved by that country, it still is not licensed until other countries’ government pharmaceutical licensing boards within the European Union have had the opportunity to object.  The stages of human experiments are typically conducted in hospitals and clinics in developed countries since the experimental phase is the beginning of the marketing of the potential drug.
 Countries compete to have drugs tested within their hospital system since this generates employment and income in that country.  This can generate an attitude of sympathy of national pharmaceutical licensing boards to drug experimenters in order to avert the risk of the experiments shifting to other countries.   However national pharmaceutical licensing boards also compete in reputation to avert costly errors to firms and governments from damaging drugs being licensed.
 The paper examines the licensing of new drugs from the viewpoint of both the license applicants and the government pharmaceutical licensing boards.   It considers risks and uncertainties that can be generated by distinct cultures and practises of licensing boards, with a focus on those in Europe,the US and Canada.  It employs the lens of the Stages of Knowledge Ahead theory of choice under risk and uncertainties to delineate the evolution of these risks through the various experimental stages, and their possible effects.