Parallel imports and a mandatory substitution reform: a kick or a muff for price competition in pharmaceuticals?

David Granlund () and Miyase Koksal-Ayhan ()

The European Journal of Health Economics, 2015, vol. 16, issue 9, 969-983

Abstract: What has been the effect of competition from parallel imports on prices of locally sourced on-patent drugs? Did the 2002 Swedish mandatory substitution reform increase this competition? To answer these questions, we carried out difference-in-differences estimation on monthly data for a panel of all locally sourced on-patent prescription drugs sold in Sweden during the 40 months from January 2001 to April 2004. On average, facing competition from parallel imports caused a 15–17 % fall in price. While the reform increased the effect of competition from parallel imports, it was only by 0.9 %. The reform, however, did increase the effect of therapeutic competition by 1.6 %. Copyright Springer-Verlag Berlin Heidelberg 2015

Keywords: Parallel imports; Pharmaceutical drugs; Price competition; Reference pricing; Therapeutic competition; I11; L51; L65 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s10198-014-0646-9

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