Deregulating the Norwegian Pharmaceuticals Market - Consequences for Costs and Availability

The aim of this paper is to analyze the impact of the deregulation of the Norwegian pharmaceuticals market in 2001 on costs and availability of pharmaceutical products. Data has been collected from the annual reports of a sample of Norwegian pharmacies before and after the deregulation of the market. In addition, data regarding the number of pharmacies in each region in Norway has also been collected. In order to study costs, a translog function is estimated. Regressin models for the number of pharmacies in each region in Norway are also estimated. The results show that the costs of the individual pharmacies have not decreased as a consequence of the deregulation of the Norwegian pharmaceuticals market. The deregulation of the market did, however, increase the availability to pharmacy services substantially. The number of pharmacies increased from 392 in year 2000 to 524 in June 2004.