Pricing and Welfare of Parallel Imports in the Pharmaceutical Industry
In this paper we investigate the implications of permitting parallel imports ofpharmaceuticals produced by a monopoly, from one country to another. We use a modelwhere countries differ in the patients’ level of co-payment for buying pharmaceuticals, andpatients differ in the utility obtained from the consumption of pharmaceuticals. We show thatthe effects of parallel imports on total welfare are as follows: On the one hand, whencountries differ in their health system only, parallel imports decrease total welfare; On theother hand, when countries differ in the health needs of their patients only, parallel importsenhance total welfare.
|Date of creation:||2003|
|Date of revision:|
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- Ganslandt, Mattias & Maskus, Keith E., 2001.
"Parallel imports of pharmaceutical products in the European Union,"
Policy Research Working Paper Series
2630, The World Bank.
- Ganslandt, Mattias & Maskus, Keith E., 2001. "Parallel Imports of Pharmaceutical Products in the European Union," Working Paper Series 546, Research Institute of Industrial Economics.
- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, December.
- Richardson, Martin, 2002. "An elementary proposition concerning parallel imports," Journal of International Economics, Elsevier, vol. 56(1), pages 233-245, January.
- repec:hhs:iuiwop:546 is not listed on IDEAS
- repec:spr:pharme:v:13:y:1998:i:3:p:293-304 is not listed on IDEAS
- Pecorino, Paul, 2002. "Should the US allow prescription drug reimports from Canada?," Journal of Health Economics, Elsevier, vol. 21(4), pages 699-708, July.
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