2007
DOI: 10.1007/s10198-007-0059-0
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The impact of generic substitution on price competition in Finland

Abstract: Generic substitution by pharmacists was introduced in April 2003 in Finnish pharmaceutical markets. This article examines the impact of generic substitution on price development. This study examined all of the 2,100 substitutable drugs in Finland. The impact of generic substitution on price competition was significant. The average price of substitutable drugs decreased by more than 10%. However, the price development was uneven; some prices increased whereas others decreased by more than 50%. The most importan… Show more

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Cited by 32 publications
(37 citation statements)
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“…One way to reduce drug costs is to enable generic drugs to enter the market. The competition between generic drug manufacturers lowers their prices, thus reducing overall cost of health care [4][5][6].…”
Section: Introductionmentioning
confidence: 99%
“…One way to reduce drug costs is to enable generic drugs to enter the market. The competition between generic drug manufacturers lowers their prices, thus reducing overall cost of health care [4][5][6].…”
Section: Introductionmentioning
confidence: 99%
“…9 Additionally, no information has been included regarding the time between patent expiry and the time of entry of a generic seller onto the PBS market. Although this is not directly relevant to the question this paper seeks to address, it may provide a proxy measure of the regulatory barriers to entry of generic sellers.…”
Section: Discussionmentioning
confidence: 99%
“…drug price) in the market. 2,3,9,21 In this context, reverse causality will cause the OLS results to underestimate the true effect of generic competition. 2,21 Therefore, in the robustness analysis, we employ an instrumental variable (IV) approach and use the two-stage least-square (2SLS) estimator to deal with this problem.…”
Section: Methods and Datamentioning
confidence: 99%
See 1 more Smart Citation
“…The lack of regulation on generics promotion regulation (no INN prescribing, no generics substitution, no reference price system [23]) is likely to be a barrier for sickness funds, because they have to motivate doctors to prescribe generics whereas, in other countries with mandatory generics substitution this would not be an issue. It has been shown that generics substitution or INN prescribing, particularly if introduced as a mandatory measure, has a positive effect on generics uptake and lowering of prices [24,25,36,[65][66][67][68][69][70][71][72][73]. Furthermore, patients in Austria are not offered incentives to ask explicitly for generics.…”
Section: Original Researchmentioning
confidence: 99%