Phytochemicals from medicinal plants are receiving ever greater attention in the scientific literature, in medicine and in the world economy in general. According to Farnsworth out of 1.532 billion prescriptions dispensed in the United States in 1973, 41.2% contained one or more constituents derived from plants. An analysis of such plant derived medicines used in prescription drugs during 1980’s found that only 40 sps of higher plants are used as sources of drugs. This indicates the potential of identifying newer leads from plants considering the vast unexplored flora of the tropical rainforests. Natural product research guided by ethnopharmacological knowledge can make substantial contributions to drug innovation by providing novel chemical structures and /or mechanism of action.

Higher plants are the direct or indirect source of several modern medicines. While many erstwhile plant drugs have been replaced by better synthetic equivalents, newer plant-based molecules have gained new investigational or therapeutic status in recent years. Also a number of novel drug candidates such as taxoids, camptothecin, artemisinin have entered the drug markets following successful plant-based clinical research. The value of medicinal plants as a source of foreign exchange for developing countries depends on the use of those plants as raw materials in the pharmaceutical industry.

Production of pure phytopharmaceuticals used in modern medicine requires more processing stages and more sophisticated machinery. Such processing techniques are patent protected and even technology transfer through contractual agreements and payments may not be of much help unless there is a large local demand for such drugs. Drugs so produced are expensive due to limitations over the economy of scale of production and also because safety and pollution aspects related to these sophisticated processing techniques have to be considered. In addition to purified plant-derived drugs such as quinine, reserpine, digoxin, etc., there is an enormous market for crude herbal medicines such as extracts, powders and tinctures. In the developing countries, OTC remedies and ‘ethical phytomedicines’, which are toxicologically standardized and clinically defined crude drugs, are seen as a promising low-cost alternatives in primary health care.

Besides an impressive OTC market, there is also an enormous prescription market for herbal medicines in some western countries. In Germany alone, the annual sales of herbal drugs is $2.5 billion with per capital spending of $37 on phyto medicines. Preparations from Ginkgo leaf are on the top of the best selling list. In 1995, German physicians ordered 254 million of defined daily doses of ginkgo mono preparations which corresponded to DM 425 million.

In the United States herbal medicines, vitamins and minerals are still a very small part of the entire medicine industry when compared to generic (64 billion in sales) and OTC (24 billions) drugs of modern medicine. However there are some botanicals approved as OTC drug ingredients and over a hundred botanicals either individually or in formulas are currently going through FDA’s clinical trial process. The US FDA has just published draft guidelines for development of botanical medicines as drugs, reflecting a growing interest in the drug model for these products. Even before the document was published, there have been many companies and individuals that have submitted the Investigation New Drug Applications (INDs) and these are in process. The day the first IND is approved will be the turning point for the herbal drug industry as it would open the doors for the availability of herbal drugs as approved ethical drugs.