Entry in the ADHD drugs market: Welfare impact of generics and me-toos

Farasat Bokhari, Gary Fournier

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15 Citations (Scopus)
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Abstract

Recent decades have seen a growth in treatments for attention deficit hyperactivity disorder (ADHD) including many branded and generic drugs. In the early 2000's, new drug entry dramatically altered market shares. We estimate a demand system for ADHD drugs and assess the welfare impact of new drugs. We find that entry induced large welfare gains by reducing prices of substitute drugs, and by providing alternative delivery mechanisms for existing molecules. Our results suggest that the success of follow-on patented drugs may come from unanticipated innovations like delivery mechanisms, a factor ignored by proposals to retard new follow-on drug approvals.
Original languageEnglish
Pages (from-to)339–392
JournalJournal of Industrial Economics
Volume61
Issue number2
Early online date11 Jul 2013
DOIs
Publication statusPublished - 2013

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