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Policy makers use reference pricing to curb pharmaceutical expenditures by reducing coverage of expensive branded drugs. In a theoretical analysis we show that the net effect of reference pricing is generally ambiguous when accounting for entry by generic producers. Reference pricing shifts...
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prices, with the effect being driven by strong brand-name price reductions, and not increases in generic prices. We also find … that RP increases generic competition, resulting in lower brand-name market shares. Finally, we show that RP has a strong …
Persistent link: https://www.econbiz.de/10014198115
Policy makers use reference pricing to curb pharmaceutical expenditures by reducing coverage of expensive branded drugs. In a theoretical analysis we show that the net effect of reference pricing is generally ambiguous when accounting for entry by generic producers. Reference pricing shifts...
Persistent link: https://www.econbiz.de/10014080046
, we develop a theory model in which a pharmacy negotiates producer prices with a brand-name firm and then sets retail …
Persistent link: https://www.econbiz.de/10013060442
theory model where the producer price is subject to bargaining between the brand-name producer and a distributor, we show …
Persistent link: https://www.econbiz.de/10013017702
In this paper we study the impact of reference pricing (RP) on entry of generic firms in the pharmaceutical market. For given prices, RP increases generic firms' expected profit, but since RP also stimulates price competition, the impact on generic entry is theoretically ambiguous. In order to...
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