The Economics of Prescription Drug Pricing

Topics:
GATT,
Pharmeceuticals,
Wholesale
Tags:
Brandeis University,
Healthcare,
Marketing,
Marketing Research,
Prescription Drug,
Pricing,
Pricing Strategy
Source:
Brandeis University

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Overview: A complex mix of government regulation and market competition characterizes the economics of prescription drug pricing. This paper provides background information necessary to understand this dynamic and evaluate potential change. It examines prescription drug price trends over time. Increasing growth is attributed to development and marketing of new products and the increasing volume of drugs prescribed. The growing number of people with prescription drug insurance coverage also increases demand and price as dose growth in direct-to-consumer advertising. Drug price inflation is less of a factor. Pricing is strongly affected by patent law and the regulatory structure that partially determines the time and cost to bring a new drug to market.

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Format: PDF | Size: 403KB | Date: Mar 2001 | Pages: 44

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