We analyze how a manufacturer with a brand-name drug close to patent expiration decides to launch a product … innovation, the incumbent firm competes for the price-sensitive physicians. However, for low levels of innovation, the incumbent … firm prefers to exploit the loyal physicians and to charge the monopoly price. The equilibrium level of innovation exhibits …

We analyze the effects on consumers of an extreme policy experiment -- Napsterizing' pharmaceuticals -- whereby all … associated with greater access to the current stock of pharmaceuticals, future consumers will be harmed by reducing the flow of … new pharmaceuticals to the market. Our estimates of the consumer surpluses at stake are based on the stylized facts …

We analyze the effects on consumers of an extreme policy experiment -- Napsterizing' pharmaceuticals -- whereby all … associated with greater access to the current stock of pharmaceuticals, future consumers will be harmed by reducing the flow of … new pharmaceuticals to the market. Our estimates of the consumer surpluses at stake are based on the stylized facts …