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Reference prices: The Spanish way

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  • Jorge Mestre

    (Office of Health Economics (UK))

Abstract

The aim of this paper is to analyse the effects of recent regulatory reforms implemented in the Spanish pharmaceutical market: the promotion of generic drugs and the implementation of reference prices. The objectives of such reforms are twofold: firstly, to increase price competition and secondly, to reduce public pharmaceutical costs. This paper shows that for the Spanish method of implementing reference prices to achieve these objectives, compared to a situation with copayments, requires the reference price to be set in a certain interval. In addition, the Spanish system may result in profits for the branded and generic producers being reduced

Suggested Citation

  • Jorge Mestre, 2003. "Reference prices: The Spanish way," Investigaciones Economicas, Fundación SEPI, vol. 27(1), pages 125-149, January.
  • Handle: RePEc:iec:inveco:v:27:y:2003:i:1:p:125-149
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    1. repec:kap:ijhcfe:v:17:y:2017:i:4:d:10.1007_s10754-017-9216-x is not listed on IDEAS
    2. 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.
    3. David Granlund & Miyase Koksal-Ayhan, 2015. "Parallel imports and a mandatory substitution reform: a kick or a muff for price competition in pharmaceuticals?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(9), pages 969-983, December.
    4. Kaiser, Ulrich & Mendez, Susan J. & Rønde, Thomas & Ullrich, Hannes, 2014. "Regulation of pharmaceutical prices: Evidence from a reference price reform in Denmark," Journal of Health Economics, Elsevier, vol. 36(C), pages 174-187.
    5. Granlund, David & Köksal, Miyase Yesim, 2011. "Parallel Imports and Mandatory Substitution Reform - A Kick or A Muff for Price Competition in Pharmaceuticals?," HUI Working Papers 49, HUI Research.
    6. Anna Merino, 2000. "The impact of the reference price system on the pharmaceutical market: A theoretical approach," Economics Working Papers 524, Department of Economics and Business, Universitat Pompeu Fabra, revised Jun 2003.
    7. Yesim Köksal, Miyase, 2009. "REFERENCE PRICING - Making Parallel Trade in Pharmaceuticals Work," Working Papers in Economics 367, University of Gothenburg, Department of Economics, revised 01 May 2011.
    8. Miraldo, Marisa, 2009. "Reference pricing and firms' pricing strategies," Journal of Health Economics, Elsevier, vol. 28(1), pages 176-197, January.
    9. Granlund, David & Yesim Köksal, Miyase, 2011. "Parallel Imports and Mandatory Substitution Reform: A kick or a muff for price competition in pharmaceuticals," Working Papers in Economics 496, University of Gothenburg, Department of Economics.

    More about this item

    Keywords

    Reference prices; copayments; generics; pharmaceutical industry;

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L00 - Industrial Organization - - General - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics

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