Generic Entry and the Pricing of Pharmaceuticals
Выход дженериков на рынок и ценообразование на фармацевтические препараты
1997-03-01
SCID: 54.1/mnb8q9yf
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Abstract (AI)
During the 1980s the share of prescriptions sold by retail pharmacies that was accounted for by generic products roughly doubled. The price response to generic entry of brand‐name products has been a source of controversy. In this paper we estimate models of price responses to generic entry in the market for brand‐name and generic drugs. We study a sample of 32 drugs that lost patent protection during the early to mid‐1980s. Our results provide evidence that brand‐name prices increase after generic entry and are accompanied by large decreases in the price of generic drugs.
Key Findings
1
Brand-name drug prices increased after generic entry, contrary to the expectation that competition would reduce them.
2
During the 1980s, generic products’ share of prescriptions sold through retail pharmacies approximately doubled.
3
Generic drug prices decreased substantially following entry into markets previously protected by brand-name patents.
4
The study estimates pharmaceutical price responses to generic entry using 32 drugs that lost patent protection in the early to mid-1980s.
Research Object
the market for brand-name and generic drugs, including 32 drugs that lost patent protection in the early to mid-1980s
Research Subject
price responses to generic entry, specifically changes in brand-name and generic drug prices after patent expiration
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1997-03-01
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