Are Important Innovations Rewarded? Evidence from Pharmaceutical Markets

Margaret Kyle

Working Papers from HAL

Abstract: This paper focuses on the relationship between therapeutic value and different measures of market rewards (the number of patents, price, market share, and total revenues) of a new treatment. Using an assessment of therapeutic value provided by the French Haute Authorité de Santé (HAS), I find a weak relationship between most measures of rewards and this assessment of therapeutic value, suggesting that the returns to developing a "me-too" product are not very different from developing treatments with greater therapeutic effects. One interpretation is that the HAS score is a poor assessment of therapeutic value, in which case the use of similar health technology assessments by governments and other payers should be re-examined. Alternatively, if the HAS score is informative, the results suggest countries are spending too much on less innovative products, and that a re-balancing of innovation incentives may be worth considering if therapeutic value is highly related to social welfare.

Date: 2017-11-06
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Related works:
Journal Article: Are Important Innovations Rewarded? Evidence from Pharmaceutical Markets (2018)
Working Paper: Are Important Innovations Rewarded? Evidence from Pharmaceutical Markets (2018)
Working Paper: Are Important Innovations Rewarded? Evidence from Pharmaceutical Markets (2017)
Working Paper: Are Important Innovations Rewarded? Evidence from Pharmaceutical Markets (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:hal-01952727

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