 How US Antitrust Can Go Astray: The Brand Name Prescription Drug LitigationF. M. Scherer International Journal of the Economics of Business, 1997, vol. 4, issue 3, 239-256 Abstract: This paper analyzes the substantive issues in a US antitrust case under which retail pharmacists alleged that drug manufacturers conspired to avoid granting the retailers discounts that were offered to health maintenance organizations (HMOs). The HMOs are viewed as an innovative means of delivering health care to consumers at lower cost. They elicited discounts by credibly threatening to exclude manufacturers' drugs unless price concessions were offered — a strategy drug retailers were unable or unwilling to pursue. In challenging those discounts, the retail pharmacists pursued their traditional strategy of using governmental power to oppose innovations that squeezed their price/cost margins and reduced drug prices to consumers. The evidence of manufacturer conspiracy appears to have been ephemeral at best, and the litigation appears more likely to have reduced competition and consumer welfare than enhancing it Keywords: Pharmaceuticals industry; Retail pharmacies; Antitrust policy; Price discrimination; Health care, JEL classifications: K21, L41, L65, 111, (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:ijecbs:v:4:y:1997:i:3:p:239-256 Ordering information: This journal article can be ordered from DOI: 10.1080/758523205 Access Statistics for this article International Journal of the Economics of Business is currently edited by Eleanor Morgan More articles in International Journal of the Economics of Business from Taylor & Francis Journals |
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