Disclosure and the Pace of Drug Development

Colleen Cunnningham, Florian Ederer, Charles Hodgson and Zhichun Wang
Additional contact information
Colleen Cunnningham: University of Utah
Florian Ederer: Boston University
Charles Hodgson: Yale University
Zhichun Wang: Yale University

No 2465, Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University

Abstract: Policies that mandate disclosure of innovative project outcomes aim to increase innovation by limiting wasteful duplicative innovation. Yet, such policies change not only the ex-post information environment but also firms' ex-ante innovation incentives. Firms may slow down their own innovation efforts in anticipation of increased disclosure by others. We examine the innovation-related impacts of the 2017 FDA Final Rule amendment, which mandates disclosure of clinical trial results for pharmaceutical firms. We show that the policy hastened and increased disclosure of results for clinical trials post-completion, but also increased the time to completion of clinical trials, the time between early phases of clinical trials, and delays in development-related investments. We provide evidence consistent with mandated disclosure leading firms to wait to learn from their competitors. Our results suggest that mandating disclosure may slow innovation when there is value to waiting.

Pages: 38 pages
Date: 2025-10-08
References: Add references at CitEc
Citations:

Downloads: (external link)
https://cowles.yale.edu/sites/default/files/2025-10/d2465.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cwl:cwldpp:2465

Ordering information: This working paper can be ordered from
Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA
The price is None.

Access Statistics for this paper

More papers in Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University Yale University, Box 208281, New Haven, CT 06520-8281 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Brittany Ladd ().