IDEAS home Printed from https://ideas.repec.org/a/taf/ijecbs/v27y2020i1p1-26.html
   My bibliography  Save this article

U.S. Pharmaceutical Markets: Expenditures, Health Insurance, New Products and Generic Prescribing from 1960 to 2016

Author

Listed:
  • Z. John Lu
  • William S. Comanor
  • Elliot Cherkas
  • Llad Phillips

Abstract

Between 1960 and 2016 per capita expenditures on retail pharmaceuticals increased from $85.12 to $922.50 in 2009 prices, while the share of spending covered by insurance programs grew to 86%. The introduction of new molecular entities followed only a weak upward trend. Following passage of the Hatch Waxman Act in 1984, the share of retail prescriptions dispensed as generics has expanded from 19% to almost 90%. By employing a three-equation Vector Auto-Regressive (VAR) model and Granger causality, this paper assesses empirically the interdependence among these variables. Our most important finding is that increases in insurance coverage on pharmaceuticals contributed significantly to the spending growth, which in turn led to further insurance expansion. In addition, introduction of new drugs also has contributed to enhanced insurance coverage. While the expansion of generic prescribing has had a strong negative effect on spending, this effect has been largely offset by rapid increases in coverage.

Suggested Citation

  • Z. John Lu & William S. Comanor & Elliot Cherkas & Llad Phillips, 2020. "U.S. Pharmaceutical Markets: Expenditures, Health Insurance, New Products and Generic Prescribing from 1960 to 2016," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 27(1), pages 1-26, January.
  • Handle: RePEc:taf:ijecbs:v:27:y:2020:i:1:p:1-26
    DOI: 10.1080/13571516.2019.1651150
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/13571516.2019.1651150
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/13571516.2019.1651150?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. William S. Comanor, 2022. "Pharmaceutical markets in Japan and the United States," International Journal of Economic Policy Studies, Springer, vol. 16(2), pages 355-370, August.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:ijecbs:v:27:y:2020:i:1:p:1-26. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIJB20 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.