Price Competition in Pharmaceuticals: The Case of Anti-infectives
AbstractA fundamental question in industrial organization regards the relationship between price and the number of sellers. This relationship has been particularly important in the pharmaceutical industry where legislative changes were specifically designed to foster competition. Previous research on the pharmaceutical industry has shown generic entry has a mixed impact; generic prices fall rapidly with generic entry, whereas branded prices tend to increase or decrease only slightly. Using more complete data, focused on one segment of the pharmaceutical industry--anti-infectives--we find that the relationship between pharmaceutical prices and the number of sellers is more like that found in other industries. (JEL L11, L65, D4) Copyright 2004, Oxford University Press.
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Bibliographic InfoArticle provided by Western Economic Association International in its journal Economic Inquiry.
Volume (Year): 42 (2004)
Issue (Month): 2 (April)
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Find related papers by JEL classification:
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
- L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology
- D4 - Microeconomics - - Market Structure and Pricing
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- Herr, Annika & Suppliet, Moritz, 2012. "Pharmaceutical prices under regulation: Tiered co-payments and reference pricing in Germany," DICE Discussion Papers 48, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
- Rizzo, John & Zeckhauser, Richard Jay, 2012.
"Generic Script Share and the Price of Brand-Name Drugs: The Role of Consumer Choice,"
8057977, Harvard Kennedy School of Government.
- John Rizzo & Richard Zeckhauser, 2009. "Generic script share and the price of brand-name drugs: the role of consumer choice," International Journal of Health Care Finance and Economics, Springer, vol. 9(3), pages 291-316, September.
- Michael Salinger & Pauline Ippolito & Joel Schrag, 2007. "Economics at the FTC: Pharmaceutical Patent Dispute Settlements and Behavioral Economics," Review of Industrial Organization, Springer, vol. 31(2), pages 85-105, September.
- Herr, A.; & Suppliet, M.;, 2011. "Co-Payment Exemptions and Reference Prices: an Empirical Study of Pharmaceutical Prices in Germany," Health, Econometrics and Data Group (HEDG) Working Papers 11/18, HEDG, c/o Department of Economics, University of York.
- Aki Kangasharju & Joni Hokkanen & Ismo Linnosmaa & Hannu Valtonen, 2012. "Generic substitution policy, prices and market structure: evidence from a quasi-experiment in Finland," Working Papers 35, Government Institute for Economic Research Finland (VATT).
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