IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

Market size and innovation: Effects of Medicare Part D on pharmaceutical research and development

Listed author(s):
  • Blume-Kohout, Margaret E.
  • Sood, Neeraj

Recent evidence suggests that Medicare Part D increased prescription drug use among seniors, and increased pharmaceutical firms' revenues from sales. Previous studies also indicate that increases in market size induce pharmaceutical innovation. This paper assesses the impact of the Medicare Part D legislation on pharmaceutical research and development (R&D), using time-series data on the number of drugs entering preclinical and clinical development by therapeutic class and phase. We find that the passage and implementation of Medicare Part D is associated with significant increases in pharmaceutical R&D for therapeutic classes with higher Medicare market share.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/pii/S0047272712001119
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 97 (2013)
Issue (Month): C ()
Pages: 327-336

as
in new window

Handle: RePEc:eee:pubeco:v:97:y:2013:i:c:p:327-336
DOI: 10.1016/j.jpubeco.2012.10.003
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505578

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Mark Duggan & Fiona Scott Morton, 2010. "The Effect of Medicare Part D on Pharmaceutical Prices and Utilization," American Economic Review, American Economic Association, vol. 100(1), pages 590-607, March.
  2. Pierre Dubois & Olivier de Mouzon & Fiona Scott-Morton & Paul Seabright, 2015. "Market size and pharmaceutical innovation," RAND Journal of Economics, RAND Corporation, vol. 46(4), pages 844-871, October.
  3. Daron Acemoglu & Joshua Linn, 2004. "Market Size in Innovation: Theory and Evidence from the Pharmaceutical Industry," The Quarterly Journal of Economics, Oxford University Press, vol. 119(3), pages 1049-1090.
  4. Civan Abdulkadir & Maloney Michael T., 2006. "The Determinants of Pharmaceutical Research and Development Investments," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-38, September.
  5. Henry G. Grabowski & Margaret Kyle, 2007. "Generic competition and market exclusivity periods in pharmaceuticals," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 28(4-5), pages 491-502.
  6. Mark Duggan & Patrick Healy & Fiona Scott Morton, 2008. "Providing Prescription Drug Coverage to the Elderly: America's Experiment with Medicare Part D," Journal of Economic Perspectives, American Economic Association, vol. 22(4), pages 69-92, Fall.
  7. Giaccotto, Carmelo & Santerre, Rexford E & Vernon, John A, 2005. "Drug Prices and Research and Development Investment Behavior in the Pharmaceutical Industry," Journal of Law and Economics, University of Chicago Press, vol. 48(1), pages 195-214, April.
  8. Yin, Wesley, 2008. "Market incentives and pharmaceutical innovation," Journal of Health Economics, Elsevier, vol. 27(4), pages 1060-1077, July.
  9. Margaret E. Blume-Kohout, 2012. "Does Targeted, Disease‐Specific Public Research Funding Influence Pharmaceutical Innovation?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 31(3), pages 641-660, 06.
  10. Golec, Joseph & Hegde, Shantaram & Vernon, John A., 2010. "Pharmaceutical R&D Spending and Threats of Price Regulation," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 45(01), pages 239-264, February.
  11. Jonathan D. Ketcham & Kosali Simon, 2008. "Medicare Part D's Effects on Elderly Drug Costs and Utilization," NBER Working Papers 14326, National Bureau of Economic Research, Inc.
  12. repec:mpr:mprres:6014 is not listed on IDEAS
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:pubeco:v:97:y:2013:i:c:p:327-336. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.