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Patient income and health innovation


  • Javad Moradpour
  • Aidan Hollis


This study analyzes the relationship between the number of clinical trials in a disease area, the health losses from that disease, and the average income of people suffering from it. Average patient income appears strongly predictive of the number of clinical trials, whether funded by industry or not. We are able to precisely estimate the relationship between income and the number of trials and to identify both (a) the specific diseases that appear to be underfunded relative to their harm to human health and (b) the amount of additional funding required to bring innovation investment up to the present average.

Suggested Citation

  • Javad Moradpour & Aidan Hollis, 2020. "Patient income and health innovation," Health Economics, John Wiley & Sons, Ltd., vol. 29(12), pages 1795-1803, December.
  • Handle: RePEc:wly:hlthec:v:29:y:2020:i:12:p:1795-1803
    DOI: 10.1002/hec.4160

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    References listed on IDEAS

    1. DiMasi, Joseph A. & Grabowski, Henry G. & Hansen, Ronald W., 2016. "Innovation in the pharmaceutical industry: New estimates of R&D costs," Journal of Health Economics, Elsevier, vol. 47(C), pages 20-33.
    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. Frank R. Lichtenberg, 2007. "Importation And Innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 16(6), pages 403-417.
    4. Eliana Barrenho & Marisa Miraldo & Peter C. Smith, 2019. "Does global drug innovation correspond to burden of disease? The neglected diseases in developed and developing countries," Health Economics, John Wiley & Sons, Ltd., vol. 28(1), pages 123-143, January.
    5. Margaret K. Kyle & Anita M. McGahan, 2012. "Investments in Pharmaceuticals Before and After TRIPS," The Review of Economics and Statistics, MIT Press, vol. 94(4), pages 1157-1172, November.
    6. Daron Acemoglu & Joshua Linn, 2004. "Market Size in Innovation: Theory and Evidence from the Pharmaceutical Industry," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(3), pages 1049-1090.
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    Blog mentions

    As found by, the blog aggregator for Economics research:
    1. Chris Sampson’s journal round-up for 7th December 2020
      by Chris Sampson in The Academic Health Economists' Blog on 2020-12-07 12:00:03


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    Cited by:

    1. Javad Moradpour & Aidan Hollis, 2021. "The economic theory of cost‐effectiveness thresholds in health: Domestic and international implications," Health Economics, John Wiley & Sons, Ltd., vol. 30(5), pages 1139-1151, May.

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