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Innovation and market dynamics in the EPO market

Author

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  • Sorisio, Enrico

    (PharmaNess scarl; University of Turin)

  • Strøm, Steinar

    (University of Oslo; The Frisch Centre, Oslo; University of Turin)

Abstract

In this paper we study the demand and supply of erythropoietin in four Nordic countries, using an econometric model based on discrete choice and a random utility model. It measures the effect of price changes as well as the loyalty of patients and physicians to a drug. Our main aims are to estimate demand for EPO and to determine the degree of competition in this Nordic market. The main motivation for this paper is to analyze the impact of product innovation on market power and welfare, e.g. on consumer and producer surplus. The product innovation is the entry of Aranesp in the Nordic market.

Suggested Citation

  • Sorisio, Enrico & Strøm, Steinar, 2009. "Innovation and market dynamics in the EPO market," HERO Online Working Paper Series 2006:3, University of Oslo, Health Economics Research Programme.
  • Handle: RePEc:hhs:oslohe:2006_003
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    References listed on IDEAS

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    More about this item

    Keywords

    Discrete choice; demand for pharmaceuticals; monopolistic competition; EPO;
    All these keywords.

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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