Brand Loyalty, Entry, and Price Competition in Pharmaceuticals after the 1984 Drug Act

摘要: IN 1984, Congress enacted a new law that greatly affected the economics of pharmaceutical industry in United States. It has been characterized as most important legislation affecting competition since 1962 Kefauver-Harris Amendments to Food and Drug Act. This 1984 law, known Price Competition Patent Term Restoration Act (hereinafter Act), facilitated entry generic drug products after patent expiration while it also restored part life lost during premarket regulatory process for introductions.1 Market by generics was relatively limited prior because costly Administration (FDA) requirements had be met imitative products. That is, drugs often would have duplicate many pioneer's tests gain market approval expiration. As result need only demonstrate bioequivalence brand, increased significantly. provided body very interesting data analyze pattern pricing strategies followed entrants incumbents. In this article, we make use covering sales prices pioneer eighteen products, generally over time period 1984-88. A number issues are examined. First,