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The Anti-Competitive Effects of Brand-Controlled "Pseudo- Generics" in the Canadian Pharmaceutical Market

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  • Aidan Hollis

Abstract

Brand-name pharmaceutical firms in Canada, upon the expiry of their patent, always license a "pseudo- generic" firm to compete directly against generic firms. This pseudo-generic is identical to the brand-name product, but is marketed as a generic, with the pseudo-generic firm receiving a distribution fee. This strategy deters entry into smaller drug markets, since the threat of pseudo-generic competition deters other generics from making the investment required to enter; and slows the process of entry by competing generic firms.

Suggested Citation

  • Aidan Hollis, 2003. "The Anti-Competitive Effects of Brand-Controlled "Pseudo- Generics" in the Canadian Pharmaceutical Market," Canadian Public Policy, University of Toronto Press, vol. 29(1), pages 21-31, March.
    • Handle: RePEc:cpp:issued:v:29:y:2003:i:1:p:21-31
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    References listed on IDEAS

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    Cited by:

    1. Reisinger, Markus, 2004. "Vertical Product Differentiation, Market Entry, and Welfare," Discussion Papers in Economics 479, University of Munich, Department of Economics.
    2. Laura Magazzini & Fabio Pammolli & Massimo Riccaboni, 2004. "Dynamic competition in pharmaceuticals," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 5(2), pages 175-182, May.
    3. Ying Kong, 2009. "Competition between brand‐name and generics – analysis on pricing of brand‐name pharmaceutical," Health Economics, John Wiley & Sons, Ltd., vol. 18(5), pages 591-606, May.
    4. Bulow, Jeremy I., 2003. "The Gaming of Pharmaceutical Patents," Research Papers 1804, Stanford University, Graduate School of Business.
    5. Magazzini, Laura & Pammolli, Fabio & Riccaboni, Massimo, 2004. "Dynamic Competition in Pharmaceuticals: Patent Expiry, Generic Penetration, and Industry Structure," MPRA Paper 15968, University Library of Munich, Germany.
    6. Patricia M. Danzon & Michael F. Furukawa, 2011. "Cross-National Evidence on Generic Pharmaceuticals: Pharmacy vs. Physician-Driven Markets," NBER Working Papers 17226, National Bureau of Economic Research, Inc.
    7. Costa-Font, Joan & McGuire, Alistair & Varol, Nebibe, 2014. "Price regulation and relative delays in generic drug adoption," Journal of Health Economics, Elsevier, vol. 38(C), pages 1-9.
    8. Marjit, Sugata & Kabiraj, Tarun & Dutta, Arijita, 2009. "Strategic Under-utilization of Patents and Entry Deterrence: The Case of Pharmaceutical Industry," MPRA Paper 19157, University Library of Munich, Germany.
    9. Ricardo Gonçalves & Vasco Rodrigues & Hélder Vasconcelos, 2015. "Reference pricing in the presence of pseudo-generics," International Journal of Health Economics and Management, Springer, vol. 15(3), pages 281-305, September.
    10. Kensuke Kubo, 2011. "Productivity, R&D, and Intellectual Property Rights in East Asia and India," Chapters, in: Masahisa Fujita & Ikuo Kuroiwa & Satoru Kumagai (ed.), The Economics of East Asian Integration, chapter 6, Edward Elgar Publishing.
    11. Appelt, Silvia, 2010. "Authorized Generic Entry prior to Patent Expiry: Reassessing Incentives for Independent Generic Entry," Discussion Papers in Economics 11476, University of Munich, Department of Economics.
    12. Lexchin, Joel, 2004. "The effect of generic competition on the price of brand-name drugs," Health Policy, Elsevier, vol. 68(1), pages 47-54, April.
    13. Laurent Granier & S颡stien Trinquard, 2012. "Predation in off-patent drug markets," Applied Economics, Taylor & Francis Journals, vol. 44(17), pages 2171-2186, June.
    14. Laurent Granier & Sébastien Trinquard, 2011. "Predation in Off-Patent Drug Markets," Post-Print hal-00687806, HAL.

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