Beyond Patient Prices: Multi-Stakeholder Responses and Behavioral Spillovers from Japan's Brand-Name Drug Surcharge

Go Nakatsui (), Fumio Ohtake (), Reo Takaku () and Naoto Tanemoto ()
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Go Nakatsui: Research Center for Advanced Policy Studies, Institute of Economic Research, Kyoto University
Fumio Ohtake: Research Center for Advanced Policy Studies, Institute of Economic Research, Kyoto University, Center for Infectious Disease Education and Research, Osaka University
Reo Takaku: Graduate School of Economics, Hitotsubashi University
Naoto Tanemoto: Policy Research Institute, Ministry of Finance, Japan

No 1130, KIER Working Papers from Kyoto University, Institute of Economic Research

Abstract: Cost-sharing reforms can shift behavior beyond the patients who pay. Using 180 million pharmacy dispensing claims, we study Japan's 2024 surcharge on brand-name drugs with generic alternatives. Generic dispensing increased in both surcharge-eligible and exempt categories, 1.92 pp more in eligible categories. Responses extended beyond own-price incentives: generic-name prescribing increased despite physicians not bearing the charge; dispensing responses showed no monotonic gradient in surcharge amounts; and generic adoption spilled over to exempt categories (+3.85 pp), concentrated among the most-exposed patients and physicians. Targeted cost-sharing can shift defaults across stakeholders beyond its formal scope, and reporting requirements can change prescribing behavior.

Keywords: generic substitution; patient cost-sharing; pharmaceutical policy; behavioral economics; Japan (search for similar items in EconPapers)
JEL-codes: D91 I11 I18 L51 (search for similar items in EconPapers)
Pages: 52pages
Date: 2026-09
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