Game theoretic analysis of persons, the pharmaceutical industry, and donors in disease contraction and recovery

Hausken, Kjell; Ncube, Mthuli

doi:10.1057/s41599-020-00626-4

Cited by 3 publications

(3 citation statements)

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“…The drug j development costs F j for hydroxychloroquine and ivermectin are unknown. Hausken and Ncube 34 assumed an HIV development cost of $2.6 billion, matched against a drug-purchasing cost for 1 person of $100 per year. Hypothetically assuming the same ratio of $2.6 billion/$100 for hydroxychloroquine and ivermectin gives the drug j development costs F 1 = $ 2 . 6 × 9 . 68 / 100 = $ 0 . 25 billion and F 2 = $ 2 . 6 × 212 . 44 / 100 = $ 5 . 52 billion.…”

Section: Resultsmentioning

confidence: 99%

“…Game theoretic contributions are rare for this phenomenon. Hausken and Ncube 34 considered 5 outcomes in a game between persons and 1 pharmaceutical company (i.e., safe behavior, risky behavior and no disease contraction, disease contraction without drug availability, disease contraction with drug availability but without buying the drug, and disease contraction and buying the drug). They illustrated with HIV/AIDS data how a parametric donor affects drug development and drug purchases.…”

Section: Introductionmentioning

confidence: 99%

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A Game Theoretic Analysis of Competition Between Vaccine and Drug Companies during Disease Contraction and Recovery

Hausken

Ncube

2021

Med Decis Making

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Background Infectious diseases such as COVID-19 and HIV/AIDS are behaviorally challenging for persons, vaccine and drug companies, and donors. Methods In 3 linked games in which a disease may or may not be contracted, [Formula: see text] persons choose risky or safe behavior (game 1). Two vaccine companies (game 2) and 2 drug companies (game 3) choose whether to develop vaccines and drugs. Each person chooses whether to buy 1 vaccine (if no disease contraction) or 1 drug (if disease contraction). A donor subsidizes vaccine and drug developments and purchases. Nature probabilistically chooses disease contraction, recovery versus death with and without each drug, and whether vaccines and drugs are developed successfully. COVID-19 data are used for parameter estimation. Results Each person chooses risky behavior if its utility outweighs safe behavior, accounting for nature’s probability of disease contraction which depends on how many are vaccinated. Each person buys a vaccine or drug if the companies produce them and if their utilities (accounting for side effects and virus mutation) outweigh the costs, which may be subsidized by a sponsor. Discussion Drug purchases depend on nature’s recovery probability exceeding the probability in the absence of a drug. Each company develops and produces a vaccine or drug if nature’s probability of successful development is high, if sufficiently many persons buy the vaccine or drug at a sales price that sufficiently exceeds the production price, and if the donor sponsors. Conclusion Accounting for all players’ interlinked decisions allowing 14 outcomes, which is challenging without a game theoretic analysis, the donor maximizes all persons’ expected utilities at the societal level to adjust how persons’ purchases and the companies’ development and production are subsidized. Highlights A game theoretic approach can help explain the production decisions of vaccine and drug companies, and the decisions of persons and a donor, impacted by Nature. In 3 linked games, N persons choose risky behavior if its utility outweighs safe behavior. Vaccine and drug companies develop vaccines and drugs sponsored by a donor if profitable, allowing 14 outcomes.

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Section: Resultsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

A Game Theoretic Analysis of Competition Between Vaccine and Drug Companies during Disease Contraction and Recovery

Hausken

Ncube

2021

Med Decis Making

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“…Mamani, Chick, and Simchi-Levi [29] develop a game theoretic model of international influenza vaccination coordination. Hausken and Ncube [20] consider a game between a drug company and patients which contemplate whether to purchase a drug.…”

Section: The Literaturementioning

confidence: 99%

Decisions of persons, the pharmaceutical industry, and donors in disease contraction and recovery assuming virus mutation

Hausken

Ncube

2021

Health Econ Rev

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Background The article develops an eight-period game between N persons and a pharmaceutical company. The choices of a donor and Nature are parametric. Methods Persons choose between safe and risky behavior, and whether or not to buy drugs. The pharmaceutical company chooses whether or not to develop drugs. The donor chooses parametrically whether to subsidize drug purchases and drug developments. Nature chooses disease contraction, recovery, death, and virus mutation. The game is solved with backward induction. Results The conditions are specified for each of seven outcomes ranging from safe behavior to risky behavior and buying no or one or both drugs. The seven outcomes distribute themselves across three outcomes for the pharmaceutical company, which are to develop no drugs, develop one drug, and develop two drugs if the virus mutates. For these three outcomes the donor’s expected utility is specified. Conclusion HIV/AIDS data is used to present a procedure for parameter estimation. The players’ strategic choices are exemplified. The article shows how strategic interaction between persons and a pharmaceutical company, with parametric choices of a donor and Nature, impact whether persons choose risky or safe behavior, whether a pharmaceutical company develops no drugs or one drug, or two drugs if a virus mutates, and the impact of subsidies by a donor.

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Game-theoretic analysis of governance and corruption in China's pharmaceutical industry

Wang,

Zhang,

Gong

et al. 2024

Front. Med.

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IntroductionWith the rapid development of China's pharmaceutical industry, issues of corruption and regulatory effectiveness have become increasingly prominent, posing critical challenges to public health safety and the industry's sustainable development.MethodsThis paper adopts a bounded rationality perspective and employs a game-theoretic evolutionary approach to establish a tripartite evolutionary game model involving pharmaceutical companies, third-party auditing organizations, and health insurance regulatory agencies. It analyzes the stable strategies of the parties involved and the sensitivity of key parameters within this tripartite game system.ResultsThe study reveals that adherence to health insurance regulations by pharmaceutical companies, refusal of bribes by third-party auditing organizations, and the implementation of lenient regulations by health insurance agencies can form an effective governance equilibrium. This equilibrium state contributes to reducing corruption in the pharmaceutical industry, balancing the interests of all parties, and promoting healthy industry development.DiscussionPharmaceutical companies must balance compliance costs against the risks of non-compliance benefits while maximizing profits; third-party auditing organizations need to choose between fulfilling their duties and accepting bribes, considering their economic benefits and professional reputation; health insurance regulatory agencies adjust their strategies between strict and lenient regulation to maximize social welfare. The paper suggests enhancing policy support, strengthening compliance supervision, improving audit independence, and adjusting regulatory strategies to optimize governance in the pharmaceutical industry. Additionally, the research highlights the role of collaborative efforts among the three parties in achieving sustainable governance. Furthermore, the study conducts a numerical simulation analysis to demonstrate the impact of various parameters on the evolutionary stability of the system, providing practical insights into the implementation of regulatory policies. This research offers new insights for policy formulation and governance in China's pharmaceutical sector, providing significant reference value for guiding the industry's sustainable development.

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Game theoretic analysis of persons, the pharmaceutical industry, and donors in disease contraction and recovery

Cited by 3 publications

References 30 publications

A Game Theoretic Analysis of Competition Between Vaccine and Drug Companies during Disease Contraction and Recovery

A Game Theoretic Analysis of Competition Between Vaccine and Drug Companies during Disease Contraction and Recovery

Decisions of persons, the pharmaceutical industry, and donors in disease contraction and recovery assuming virus mutation

Game-theoretic analysis of governance and corruption in China's pharmaceutical industry

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