On insurance and the cost-sharing of pharmaceutical R&D
AbstractRamsey pricing has been proposed in the pharmaceutical industry as a principle to price discriminate among markets while allowing to recover the (fixed) R&D cost. However, such analyses neglect the presence of insurance or the fund raising costs for drug reimbursement. By incorporating these new elements, we aim at providing some building blocks towards an economic theory merging Ramsey pricing, equity concerns by governments and the strategic incentives, as governments also determine the reimbursement level in countries with a NHS-like system. This will have important implications to the application of Ramsey pricing principles to pharmaceutical products across countries.
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Bibliographic InfoPaper provided by Barcelona Graduate School of Economics in its series Working Papers with number 293.
Date of creation: Sep 2006
Date of revision:
Ramsey pricing; coinsurance.;
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