Poor oral bioavailability for many drugs is generally attributed to poor solubility in the gastrointestinal fluids, poor gut membrane permeability and/or extensive hepatic first-pass elimination. Recently, however, it has been recognized that cytochrome P-450 3A mediated drug metabolism in the intestine, and P-glycoprotein counter-transport processes may also contribute significantly to poor drug bioavailability. We have shown that cyclosporin, a highly lipid soluble, large molecular weight compound does not appear to have absorption problems, with approximately 86% of the present commercial formulation being absorbed intact in healthy volunteers. Rather, the low bioavailability of cyclosporin results from extensive metabolic extraction in the gut which approaches 60%. Recently, a strong overlap has been identified between substrates for gut metabolism by cytochrome P-450 3A and gut counter-transport by P-glycoprotein, suggesting that these processes may work together to limit the bioavailability of a large number of drug substances. Recognition of this potential for metabolism and counter-transport process in the gut leads to a new perspective on improving drug bioavailability that differs from the traditional physico-chemical approach.