Within the pharmaceutical industry, the application of clinical pharmacogenomics promises to enhance the discovery of drug response markers, reduce the size and expense of clinical drug trials and provide a new tool for addressing regulatory approval issues. Today, pharmacogenomics is primarily applied early in clinical drug development by prospective genotyping in Phase I trials, to ensure that a subject population is representative with respect to drug metabolism phenotypes. The banking of genetic material from later stage trials for retrospective studies on drug response is becoming more frequent, but is not yet standard in the industry. This article provides an overview of the driving forces that are encouraging pharmacogenomic strategy development in the pharmaceutical industry, and the significance of polymorphisms in drug metabolizing enzymes (DMEs) and target proteins.