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Monday Health Economics Seminar


On Monday, June 11 2018, 14:00 - 15:30, Katharina Blankart (CINCH, University Duisburg-Essen) will present:

The downside of the policy coin: explaining changes in off- vs. on-patent drug utilization - a decomposition approach

Generic utilization has increased at a faster rate than that of pharmaceuticals under patent protection within the last decade. In this study, we analyze to what extent the differences in changes in utilization between generic and brand name versions of pharmaceuticals over time can be explained by variation in promotional activity, competition, regulation for efficient prescribing and characteristics relevant to the prescribing physicians. We compile data from a list of generic entries, European Medicines agency brand name market authorizations, a panel of 3,025 prescribing physicians, promotional data at molecule level and information on policies for efficient drug use in Germany between 2011 and 2014. We employ an Oaxaca-Blinder decomposition approach to identify the share of unexplained variation between 1) on-patent (70 substances) and off-patent markets (51 substances) and 2) generic and brand name markets in the off-patent market (49 substances each). We account for common support of the explanatory variables and drug class fixed effects. Outcome variables reflect growth rates and first differences by the number of prescriptions, sales, number of patients prescribed and prescriptions per patient between the first quarters of 2011 and 2014. The partial regression results suggest heterogeneous effects of promotion and regulation specific characteristics (share of aut-idem prescriptions, reference pricing) by outcomes analyzed while changes in competition had similar effects. Across outcome specifications, we find that the component attributable to differences in the observed characteristics of off-patent and on patent markets (5.66% at maximum) and generic and branded substances (8.85% maximum) is small. Our results may suggest specification of a generic market structure function. Increases in generic utilization seem largely beyond regulators’ control of economically efficient prescribing

Room: WST-C.02.12, Weststadttürme Berliner Platz 6-8, Essen

To find more on upcoming seminars, click here.