It is a very interesting question. The reason is what is known as regulatory capture. This is normally thought of as the regulators being captured by the industry they are trying to regulate, but it is really more a symbiotic relationship between both sides. Through regulation the large pharmaceutical companies can keep out the competition from any small pharmaceutical companies, while the regulators gain a nice job and importance.<p>The only losers here are the public since we miss out on cheap effective drugs because the regulations make them too expensive to produce for most diseases and people.