907 resultados para Pharmaceutical-industry


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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 effects to make inferences about the existence of vertical foreclosure. I estimate the vertical entry model using data from the US generic pharmaceutical industry. The estimates indicate that vertical integration is unlikely to generate anticompetitive foreclosure effects. On the other hand, significant efficiency effects are found to arise from vertical integration. I use the parameter estimates to simulate a policy that bans vertically integrated entry. The simulation results suggest that such a ban is counterproductive; it is likely to reduce entry into smaller markets.

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From the Introduction. The pharmaceutical sector inquiry carried out by the European Commission in 2008 provides a useful framework for assessing the relationship between the patent system on the one hand and competition policy and law on the other hand. The pharmaceutical market is not only specifically regulated. It is also influenced by the special characteristics of the patent system which enables pharmaceutical companies engaged in research activities to enter into additional arrangements to cope with the competitive pressures of early patent application and the delays in drug approval. Patents appear difficult to reconcile with the need for sufficient and adequate access to medicines, which is why competition expectations imposed on the pharmaceutical sector are very high. The patent system and competition law are interacting components of the market, into which they must both be integrated. This can result in competition law taking a very strict view on the pharmaceutical industry by establishing strict functional performance standards for the reliance on intellectual property rights protection granted by patent law. This is in particular because in this sector the potential welfare losses are not likely to be of only monetary nature. In brief, the more inefficiencies the patent system produces, the greater the risk of an expansive application of competition law in this field. The aim of the present study is to offer a critical and objective view on the use or abuse of patents and defensive strategies in the pharmaceutical industry. It shall also seek to establish whether patents as presently regulated offer an appropriate degree of protection of intellectual property held by the economic operators in the pharmaceutical sector and whether there is a need or, for that matter, scope for improvement. A useful starting point for the present study is provided by the pharmaceutical sector competition inquiry (hereafter “the sector inquiry”) carried out by the European Commission during the first half of 2008. On 8 July 2008, the Commission adopted its Final Report pursuant to Article 17 of Regulation 1/2003 EC, revealing a series of “antitrust shortcomings” that would require further investigation1.

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The pharmaceutical industry is one of the most competitive sectors in the European Union. With its substantial investments in research and development, this industry represents a key asset for the European economy and a major source of growth and employment. However, despite the importance of the pharmaceutical sector for the European Union, few researchers have attempted to assess the determinants of the EU exports of pharmaceuticals. This paper aims at filling the aforementioned gap by examining what drives EU exports of pharmaceuticals. In order to tackle this question, this paper has derived hypotheses from the Gravity Model of Trade and the relevant academic literature on pharmaceuticals. Based on an econometric analysis, the research sheds light on the complex interaction of factors influencing the EU exports of pharmaceuticals. The paper finds that the protection of intellectual property in the receiving countries, their economic size, the importance of their health sector, and the quality of infrastructures constitute major drivers to the EU exports of pharmaceuticals. On the contrary, the research shows that transports costs as well as tariff barriers and non-tariff barriers tend to hinder the EU exports of pharmaceuticals.

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Final report (SW-508) describing work performed for the Federal Solid waste management program under Contract no. 68-01-2684.

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Item 231-B