Why big pharma?

Big pharma usually refers to Pfizer, Glaxo, Hoffman, Sanofi, Novartis, AstraZenica and Merck. 

Why are pharmaceuticals sold in the U.S. so commonly produced by these companies and is it harmful to innovation to have only seven big companies?

My answer is that it doesn't matter what oligopoly theory suggests, the reality is that innovation is only possible in the current environment because these companies are big. 

There are two reasons for the concentration of big corporations: 1) pharmaceutical (and physical devices like stents and body replacement products) are usually developed by small firms, small laboratories and start-up companies. None of these small entities can survive the perpetual lawsuits that invariable destroy the innovative companies. Malpractice  lawsuits against manufacturers are common and successful.  So, they sell out to or merge with a bigger company to survive the lawsuits.

2) the cost of bringing a pharmaceutical or medical device to market via the FDA are so high that no small company can afford it. So,they sell out to or merge with a bigger company to survive the FDA testing process.

That is just the current reality.