We found a match
Your institution may have rights to this item. Sign in to continue.
- Title
The Effects of Competition on Pharmaceutical Advertising and Safety.
- Authors
David, Guy; Markowitz, Sara; Allen, Lindsay
- Abstract
The extent of pharmaceutical advertising and promotion can be characterized as a balancing act between profitable demand expansions and potentially unfavorable subsequent regulatory actions. However, this balance also depends on the nature of competition (e.g. monopoly versus oligopoly). In this paper, we model the firm's behavior under different competitive scenarios and test the model's predictions using a novel combination of sales, promotion, advertising, and adverse event reports data. We focus on the market for erectile dysfunction drugs as the basis for estimation. This market is ideal for analysis as it is characterized by an abrupt shift in structure, all drugs are branded, the drugs are associated with adverse health events, and have extensive advertising and promotion. We find that advertising and promotion expenditures increase own market share but also increase the share of adverse drug reactions. Competitors' spending decreases market share, while also having an influence on adverse drug reactions.
- Subjects
ADVERTISING; PHARMACEUTICAL industry; SUPPLY &; demand; ECONOMIC competition
- Publication
Proceedings of the Northeast Business & Economics Association, 2011, p106
- ISSN
1936-203X
- Publication type
Article