The Effect of Price Regulation on the Diffusion of New Drugs
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Journal Title
Journal ISSN
Volume Title
School of Business |
Bachelor's thesis
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Author
Date
2023
Department
Major/Subject
Mcode
Degree programme
Bachelor’s programme in Economics
Language
en
Pages
30
Series
Abstract
This thesis investigates the impact of price regulation on the diffusion of new drugs, employing an approach that incorporates both a simple supply-demand model and an extensive literature review. Emphasizing two key papers in the review, the framework suggests that firms are disinclined to enter markets subject to price controls. Empirical evidence underscores that price controls not only cause delays and diminish the probability of drug launches within a specific market but also exhibit ripple effects across other markets through reference pricing mechanisms. The findings highlight the pivotal role of patents and policy decisions in shaping the diffusion dynamics of innovative pharmaceuticals.Description
Thesis advisor
Saxell, TanjaKeywords
price control, drug launch, price regulation, pharmaceutical market
