Antoñanzas Villar, Fernando; Juárez-Castelló, Carmelo; … - In: SERIEs : Journal of the Spanish Economic Association 2 (2011) 1, pp. 75-95
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 …
