Generic Competition in the US Pharmaceutical Industry

Atanu Saha, Henry Grabowski, Howard Birnbaum, Paul Greenberg () and Oded Bizan

International Journal of the Economics of Business, 2006, vol. 13, issue 1, 15-38

Abstract: We develop a simultaneous equations estimation framework to understand the interactions among generic entry, prices, and market shares. We base our estimates on a panel data sample of 40 brand-name drugs that first experienced generic competition during the period July 1992-January 1998. We find that generic share and price are simultaneously determined, while the number of generic entrants is a key determinant of generic market share and the generic-to-brand price ratio. In addition, we find generic competition to be particularly intense for blockbuster drugs, which experience significantly more generic entrants, price erosion, and generic penetration than other drugs.

Keywords: Generic Entry; Competition; JEL Classifications: I11; L11 (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (45)

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DOI: 10.1080/13571510500519905

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