Recent empirical contributions emphasize the importance of (potential) market size for the development of new pharmaceuticals. At the same time many scholars point out the importance of of scientific advances for the industry's R&D activities. Against this background I analyze the relationship...

To control Medicaid's increasing expenditure on reimbursement of outpatient prescription drugs, the Omnibus Budget Reconciliation Act of 1990 included a rebate program that featured a most favored customer (MFC) clause. This clause guarantees that Medicaid gets a fixed rebate on each unit of...

This paper studies the effects of price regulation and parallel imports in the on-patent pharmaceutical market. In a theory model where the producer price is subject to bargaining between the brand-name producer and a distributor, we show that the effects of stricter price regulation crucially...

Constantly rising expenditures for pharmaceuticals require government intervention in firms' pricing decisions. To this end, reference pricing systems are a frequently employed regulatory mechanism. This paper considers a duopoly market with vertically differentiated firms under different...

Constantly rising expenditures for pharmaceuticals and uninformed consumers require government intervention in firms’ pricing strategies. To this end, reference pricing systems are frequently employed as regulatory mechanisms. This paper considers a duopoly market with vertically...

Wie vorliegende Arbeit zeigt, weisen Härte- bzw. Nicht-Härtefälle im GVK-Arzneimittelbereich deutliche Unterschiede sowohl bei der Inanspruchnahme als auch bei den Ausgaben auf, weshalb Härtefälle ohne Befreiungsregelungen durch enorme Zuzahlungen belastet wären. Zudem zeigt sich auch,...

This paper examines the optimal content regulation of DTCA by comparing two forms of DTCA-product-specific and category-specific-and identifies a key tradeoff which underlies this policy debate. Our analysis suggests that the optimal form of DTCA depends crucially on the cost effectiveness of...

Who gains from more information on the quality of pharmaceutical drugs? Are there incentives for voluntary post-approval clinical trials among pharmaceutical companies? Contrary to popular belief, this paper shows that it is not in the consumer interest that clinical evidence establishing the...

Der Apothekenmarkt wird in Deutschland in vieler Hinsicht reglementiert. Ein Großteil der verkauften Produkte unterliegt einer Preisbindung und der Marktzugang ist stark beschränkt. Die Autorin plädiert für eine Liberalisierung des Marktes und macht konkrete Reformvorschläge.

Individual moral hazard engendered by health insurance and monopolistic production are both typical phenomena of drug markets. We develop a simple model containing these two elements and evaluate the market equilibrium on the basis of consumer and social welfare. The consumer welfare criterion...