We examine trends in the productivity of the pharmaceutical sector over the past three decades. Motivated by Ricardo's insight that productivity and rents are endogenous to demand when inputs are scarce, we examine the industry's aggregate R&D production function. Using exogenous demand shocks...

Since the patent system relies on private litigation for challenging weak patents, and patent settlements might influence the incentives for challenging patents, the question arises whether the antitrust assessment of patent settlements should also consider their impact on the incentives to...

This paper introduces a novel method for examining the effects of vertical integration. The basic idea is to estimate the parameters of a vertical entry game. By carefully specifying firms' payoff equations and constructing appropriate tests, it is possible to use estimates on rival profit...

This paper examines generic entry into the Japanese pharmaceutical market. Relatively little is known about generic entry in regulated markets. Using micro data between 2003 and 2005, I find that generic entry is sensitive to the prescription pattern driven by the price regulation and healthcare...

Background: Well-functioning competitive markets are key to controlling generic drug prices. This is important since over 90% of all drugs sold in the US are generics. Recently, there have been examples of large price increases in the generic market. Methods: This paper examines price...

By introducing n (1) firms with infinite cross-price elasticity (i.e. generic drugs), we explore the effects of competition on the optimal pricing strategies under a Reference Pricing Scheme (RPS). A two-stage model repeated infinite number of times is presented. When stage 1 is competitive, the...

Patent expiration represents a turning point for the brand losing patent protection as bioequivalent generic versions of the drug quickly enter the market at reduced prices. In this paper, we study how physician characteristics and their prescribing decisions impact the competition among...

This study of the Indian Pharmaceutical Industry (IPI) attempts to identify existing and proposed business models for the choice of strategic options for the success of the Indian pharmaceutical industry in the New Patent Regime. As part of the study, a number of company and industry reports,...

A non-trivial fraction of people cannot afford to buy pharmaceutical products at unregulated market prices. Therefore, the paper analyzes the public insurance of the pharmaceutical products in terms of price controls and the socially optimal third-degree price discrimination. It characterizes...