IDEAS home Printed from https://ideas.repec.org/p/mar/magkse/202505.html
   My bibliography  Save this paper

Evaluation of a Partial Ban of Rx-Rebates in Germany Using Difference-in-Differences

Author

Listed:
  • Maximilian M. Gail

    (Justus Liebig University Giessen, Chair for Industrial Organization, Regulation and Antitrust)

  • Georg Götz

    (Justus Liebig University Giessen, Chair for Industrial Organization, Regulation and Antitrust)

  • Daniel Herold

    (Justus Liebig University Giessen, Chair for Industrial Organization, Regulation and Antitrust)

  • Jan Schäfer

    (Justus Liebig University Giessen, Chair for Industrial Organization, Regulation and Antitrust)

Abstract

In December 2020, Germany implemented a policy restricting online pharmacies from offering rebates on prescription drugs to members of the statutory health insurance. This policy change created a natural experiment, allowing us to analyze its impact on the pharmaceutical market using Difference-in-Differences. Utilizing a novel dataset, we find that the ban led to a shift in consumer behavior, increasing offline pharmacy Rx sales by 1.36% to 1.65%. However, the policy’s effects were unevenly distributed across pharmacies. While all pharmacies experienced some benefit, the impact was disproportionately larger for higher-revenue pharmacies. For instance, pharmacies in the lowest revenue decile saw a modest annual profit increase of €1,360, whereas those in the highest decile gained more than five times that amount. Our findings indicate that the introduction of VOASG alone was insufficient to reverse the declining trend in pharmacy numbers in Germany. To strengthen the comprehensive supply of pharmaceuticals to the general population, additional reforms are necessary.

Suggested Citation

  • Maximilian M. Gail & Georg Götz & Daniel Herold & Jan Schäfer, 2025. "Evaluation of a Partial Ban of Rx-Rebates in Germany Using Difference-in-Differences," MAGKS Papers on Economics 202505, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    • Handle: RePEc:mar:magkse:202505
    as

    Download full text from publisher

    File URL: https://www.uni-marburg.de/en/fb02/research-groups/economics/macroeconomics/research/magks-joint-discussion-papers-in-economics/papers/2025-papers/05-2025.pdf
    File Function: First version
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Pharmacies; Prescription Drugs; Resale Price Maintenance; Regulation; Public Health;
    All these keywords.

    JEL classification:

    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

    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:mar:magkse:202505. 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: Bernd Hayo (email available below). General contact details of provider: https://edirc.repec.org/data/vamarde.html .

    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.