The importance of the first generic substitution: Evidence from Sweden

Aljoscha Janssen and David Granlund

Journal of Economic Behavior & Organization, 2023, vol. 213, issue C, 1-25

Abstract: We analyze changes in the willingness to substitute from prescribed pharmaceuticals to more affordable generic equivalents in response to the first experience with a substitution. Using Swedish individual-level data of prescribed and dispensed pharmaceuticals, we employ a dynamic event study and an instrumental variable approach to show that an initial substitution reduces the probability of opposing subsequent substitutions by 39 percentage points. We recommend that policy-makers target patients with a history of opposed substitution and offer additional discounts to promote substitution as long-term savings outweigh one-time costs.

Keywords: Generic substitution; Pharmaceuticals; Health care costs (search for similar items in EconPapers)
JEL-codes: D12 I11 I12 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:213:y:2023:i:c:p:1-25

DOI: 10.1016/j.jebo.2023.07.017

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