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The impact of new drug launches on longevity: evidence from longitudinal disease-level data from 52 countries, 1982-2001

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  • Frank R. Lichtenberg

Abstract

We perform an econometric analysis of the effect of new drug launches on longevity, using data from the IMS Health Drug Launches database and the WHO Mortality Database. Our data cover virtually all of the diseases borne by people in 52 countries during the period 1982-2001, and enable us to control, to an unusually great extent, for the effects of other potential determinants of longevity, e.g. education, income, nutrition, the environment, and lifestyle'. We find that launches of new chemical entities (NCEs) have a strong positive impact on the probability of survival. Launches of (older) drugs that are not NCEs do not increase longevity. NCE launches account for a significant fraction of the long-run increase in longevity in the sample as a whole. Between 1986 and 2000, average life expectancy of the entire population of sample countries increased by almost two years. Our estimates imply that NCE launches accounted for 0.8 years (40%) of the 1986-2000 increase in longevity. The average annual increase in life expectancy of the entire population resulting from NCE launches is .056 years, or 2.93 weeks.

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  • Frank R. Lichtenberg, 2003. "The impact of new drug launches on longevity: evidence from longitudinal disease-level data from 52 countries, 1982-2001," NBER Working Papers 9754, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:9754
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    1. Lichtenberg, Frank R, 1996. "Do (More and Better) Drugs Keep People Out of Hospitals?," American Economic Review, American Economic Association, vol. 86(2), pages 384-388, May.
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    1. Francesco Lancia & Giovanni Prarolo, 2012. "A politico-economic model of aging, technology adoption and growth," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(3), pages 989-1018, July.
    2. Frank R. Lichtenberg, 2007. "Importation And Innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 16(6), pages 403-417.
    3. Margaret Oppenheimer & Helen LaVan & William Martin, 2015. "A Framework for Understanding Ethical and Efficiency Issues in Pharmaceutical Intellectual Property Litigation," Journal of Business Ethics, Springer, vol. 132(3), pages 505-524, December.
    4. Shamim S. Mondal & Viswanath Pingali, 2017. "Competition and Intellectual Property Policies in the Indian Pharmaceutical Sector," Vikalpa: The Journal for Decision Makers, , vol. 42(2), pages 61-79, June.
    5. Lichtenberg Frank R., 2010. "Pharmaceutical Price Discrimination and Social Welfare," Capitalism and Society, De Gruyter, vol. 5(1), pages 1-32, July.
    6. Rodrigo R. Soares, 2005. "Mortality Reductions, Educational Attainment, and Fertility Choice," American Economic Review, American Economic Association, vol. 95(3), pages 580-601, June.
    7. Rodrigo R. Soares, 2007. "On the Determinants of Mortality Reductions in the Developing World," Population and Development Review, The Population Council, Inc., vol. 33(2), pages 247-287, June.
    8. Mondal, Shamim S. & Pingali, Viswanath, 2015. "Competition Law and the Pharmaceutical Sector in India," IIMA Working Papers WP2015-11-02, Indian Institute of Management Ahmedabad, Research and Publication Department.
    9. Vola, Federico & Vinci, Bruna & Golinelli, Davide & Fantini, Maria Pia & Vainieri, Milena, 2020. "Harnessing pharmaceutical innovation for anti-cancer drugs: Some findings from the Italian regions," Health Policy, Elsevier, vol. 124(12), pages 1317-1324.
    10. Frank R. Lichtenberg, 2004. "The Expanding Pharmaceutical Arsenal in the War on Cancer," NBER Working Papers 10328, National Bureau of Economic Research, Inc.
    11. Bergh, Andreas & Nilsson, Therese, 2009. "Good for living? On the relation between globalization and life expectancy," Working Papers 2009:9, Lund University, Department of Economics.
    12. Lee Branstetter & Chirantan Chatterjee & Matthew J. Higgins, 2016. "Regulation and welfare: evidence from paragraph IV generic entry in the pharmaceutical industry," RAND Journal of Economics, RAND Corporation, vol. 47(4), pages 857-890, November.
    13. Nebibe Varol & Joan Costa-Font & Alistair McGuire, 2012. "Do International Launch Strategies of Pharmaceutical Corporations Respond to Changes in the Regulatory Environment?," Chapters, in: Alistair McGuire & Joan Costa-Font (ed.), The LSE Companion to Health Policy, chapter 12, Edward Elgar Publishing.
    14. Nebibe Varol & Joan Costa-i-Font & Alistair McGuire, 2011. "Explaining Early Adoption on New Medicines: Regulation, Innovation and Scale," CESifo Working Paper Series 3459, CESifo.
    15. Khaled Elmawazini & Pranlal Manga & Sonny Nwankwo & Bader AlNaser, 2019. "Health gap between developed and developing countries: Does globalization matter?," Economic Change and Restructuring, Springer, vol. 52(2), pages 123-138, May.
    16. Abdulkadir Civan & Michael Maloney, 2017. "Launch Decisions of Pharmaceutical Companies," Journal of Economics and Financial Analysis, Tripal Publishing House, vol. 1(1), pages 35-58.
    17. Bui, Thi Mai Van & Stolpe, Michael, 2007. "The impact of new drug launches on the loss of labor from disease and injury: evidence from German panel data," Kiel Working Papers 1317, Kiel Institute for the World Economy (IfW).
    18. Joan Costa-Font & Alistair McGuire & Nebibe Varol, 2015. "Regulation effects on the adoption of new medicines," Empirical Economics, Springer, vol. 49(3), pages 1101-1121, November.
    19. Heuer, Alexander & Mejer, Malwina & Neuhaus, Jennifer, 2007. "The national regulation of pharmaceutical markets and the timing of new drug launches in Europe," Kiel Advanced Studies Working Papers 437, Kiel Institute for the World Economy (IfW).
    20. Zhou Yang & Donna B. Gilleskie & Edward C. Norton, 2009. "Health Insurance, Medical Care, and Health Outcomes: A Model of Elderly Health Dynamics," Journal of Human Resources, University of Wisconsin Press, vol. 44(1).

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    More about this item

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • F00 - International Economics - - General - - - General

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