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http://hdl.handle.net/10419/57630
  

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dc.contributor.authorHerr, Annikaen_US
dc.contributor.authorSuppliet, Moritzen_US
dc.date.accessioned2012-04-20en_US
dc.date.accessioned2012-04-26T14:38:38Z-
dc.date.available2012-04-26T14:38:38Z-
dc.date.issued2012en_US
dc.identifier.isbn978-3-86304-047-5en_US
dc.identifier.urihttp://hdl.handle.net/10419/57630-
dc.description.abstractMany countries with national health care providers and health insurances regulate the market for pharmaceuticals to steer drug demand and to control expenses. For example, they introduce reference pricing or tiered co-payments to enhance drug substitution and competition. Since 2006, Germany follows an innovative approach by differentiating drug co-payments by the drug's price relative to its reference price. In this two-tier system, prescription drugs are completely exempted from co-payments if their prices undercut a certain price level relative to the reference price. We identify the effect of the policy on the prices of all affected prescription drugs and differentiate the analysis by firm types (innovative, generic, branded generic or importing firms). To identify a causal effect, we use a differences-in-differences approach and additionally exploit the fact that the exemption policy had been introduced successively in the different clusters. We use quarterly data from 2007 to 2010 and find empirical evidence for differentiated price setting strategies by firm types, ranging from price decreases of -13.1% (branded generics firms) to increases of +2.0% (innovators) following the introduction of potential reductions in co-payments. We refer to the latter result as the co-payment exemption paradox. Our competition proxy (no. of firms) suggests a significant but small negative correlation with prices.en_US
dc.language.isoengen_US
dc.publisherDICE Düsseldorfen_US
dc.relation.ispartofseriesDICE Discussion Paper 48en_US
dc.subject.jelD22en_US
dc.subject.jelD40en_US
dc.subject.jelI18en_US
dc.subject.jelI11en_US
dc.subject.jelL11en_US
dc.subject.ddc330en_US
dc.subject.keywordpharmaceuticalsen_US
dc.subject.keywordpricesen_US
dc.subject.keywordco-paymentsen_US
dc.subject.keywordreference pricingen_US
dc.subject.keywordregulationen_US
dc.subject.keywordfirm behavioren_US
dc.titlePharmaceutical prices under regulation: Tiered co-payments and reference pricing in Germanyen_US
dc.typeWorking Paperen_US
dc.identifier.ppn690258666en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
dc.identifier.repecRePEc:zbw:dicedp:48-
Appears in Collections:DICE Discussion Paper, Düsseldorf Institute for Competition Economics (DICE)

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