Are legislators able to meet efficiency goals?: an analysis of the pharmaceutical industry

Research and development (R&D) of new products is considered to be one of the central factors leading to an increase in the welfare of a society. Pain relief, reduced death rates and the fact that we can look forward to and enjoy longer and more comfortable lives today is largely owed to intense medical R&D. People rely on the positive effects of drugs and on future development resulting in an even greater amount of products curing everything from a simple cold to AIDS. The healing effects of medicine and the proliferation of drugs are thus essential factors for today’s society. However, in parallel of the need of developing new drugs there is today a need of lowering the medical bill. Society’s medical costs have been increasing for several decades, reaching unsustainable levels.

Contents

I. INTRODUCTION
1.1 BACKGROUND
1.2 METHODOLOGY AND AIM OF THESIS
1.3 DISPOSITION
II. THEORETICAL FRAMEWORK
2.1 ECONOMIC FRAMEWORK
2.2 ECONOMIC SCOPE
2.3 LEGISLATIVE THEORY
2.4 LEGISLATIVE SCOPE
III. CHANGES IN THE LEGAL ENVIRONMENT AND THE EFFECTS
3.1 SHORTENED APPROVAL PROCESS FOR GENERIC DRUGS
3.2 BOLAR PROVISION
3.3 EXTENSION OF THE PATENT DURATION
IV. WHAT REAL IMPACTS CAN WE EXPECT FROM THESE LEGISLATIVE CHANGES?
4.1 EFFECTS ON THE EX ANTE GOAL OF INCREASED R&D INCENTIVES
4.1.1 EFFECTS OF THE EXTENDED PATENT LENGTH
4.1.2 EFFECTS OF THE INCREASED GENERIC COMPETITION
4.1.3 NET EFFECTS
4.2 EFFECTS ON THE EX POST GOAL OF DECREASED SOCIAL COSTS
4.2.1 EFFECTS OF THE EXTENDED PATENT LENGTH
4.2.2 EFFECTS OF THE INCREASED GENERIC COMPETITION
4.2.3 NET EFFECTS
V. CONCLUDING DISCUSSION
FUTURE RESEARCH
REFERENCES
APPENDIX 1. THE DRUG APPROVAL PROCESS
APPENDIX 2. GLOSSARY AND ABBREVIATIONS

Author: Zeitoun, Suzanna

Source: Linköping University

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