The receptor occupancy theory states that the extent of a drug's response is related to the number of receptors it occupies.

A higher drug concentration leads to more occupied receptors, resulting in a higher response.

Drug–receptor complex formation is characterized by association and dissociation rates.

At equilibrium, the two rates are equal, and the ratio of their rate constants yields the equilibrium association constant K_a.

The inverse of K_a is the equilibrium dissociation constant K_d.

A higher K_a and a lower K_d value indicate greater drug affinity.

Fractional occupancy, calculated as the ratio of occupied receptors to total receptors and which is also expressed in terms of  K_d, indicates the extent of binding at a given drug concentration.

Plotting fractional occupancy against the logarithmic scale of drug concentration shows that an increase in free drug concentration increases the fractional occupancy.

When the concentration equals K_d, the fractional occupancy reaches 0.5, indicating fifty percent receptor occupancy.

As the free drug concentration increases, the fractional occupancy approaches unity, resulting in a maximal response.