Strategic Submissions: An Analysis of Supplemental Drug Approvals

Pierre Dubois, Elissa Gentry and Tuba Tunçel
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Pierre Dubois: TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - Comue de Toulouse - Communauté d'universités et établissements de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Elissa Gentry: TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - Comue de Toulouse - Communauté d'universités et établissements de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Tuba Tunçel: TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - Comue de Toulouse - Communauté d'universités et établissements de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, FSU - Florida State University [Tallahassee], CEPR - Center for Economic Policy Research

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Abstract: Off-label use regulation has the potential to change pharmaceutical firms' behavior and—consequently—affect patient welfare. We investigate the impact of changes in off-label regulation on pharmaceutical firms' behavior in seeking formal marketing ap proval for supplemental uses. In 2012, a US court decision protected truthful off-label promotion, providing pharmaceutical companies more leeway to promote off-label uses of their drug. Using a unique data set of pharmaceutical firms' research and development projects, we exploit this regulatory change to understand how firms react to government policies. Results demonstrate that the hazard of approval declined for supplemental uses, relative to original uses, after the policy change. Patent protection, potential market size, and competition are also important determinants of the hazard of approval. These results have implications not only for innovation policy but for the creation of high-quality data for certain indications.

Keywords: Off-label drugs; Drug efficacy; Prescription drugs; Pharmaceutical firm behavior (search for similar items in EconPapers)
Date: 2026
Note: View the original document on HAL open archive server: https://hal.science/hal-05752206v1
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Published in Journal of Economics and Management Strategy, 2026, ⟨10.1111/jems.70038⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05752206

DOI: 10.1111/jems.70038

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