[mrep]

I'm not very familiar with the drug market myself, but game theory can theorize why they can do it. From what I have read, drugs cost a lot of money and a few years to get to market even when they are not patent protected. This means that when a competitor starts investing money in a competing product, the main company can simply reduce the price to a point where that investment is no longer profitable. Potential competitors know this and that’s why they wont enter the market.