This study examines the relationships between firm size, R&D costs and output in the pharmaceutical industry. Porject-level data from a survey of 12 US-owned pharmaceutical firms on drug development costs, development phase lengths and failure rates are used to determine estimates of the R&D...

The 1984 Drug Price Competition and Patent Term Restoration Act (the Waxman-Hatch Act) is unique in many ways. This Law was the first change in U.S. patent terms since 1861. It simultaneously lowered the barrier to entry for generic drug firms and increased patent terms for new drugs delayed by...

Pharmacy benefit management companies (PBMs) have emerged over the past decade in response to increased demand for health care cost containment. The ability to obtain volume rebates from drug manufacturers was the principle value added by the PBM industry during the early 1990s. However, PBM...

The focus of this paper is the economics of the pharmaceutical R&D process. Major developments currently impacting the industry include the fact that R&D costs for new drugs are rising very rapidly. Product life cycles are also shortening, meaning there is less time to recover R&D costs and...