Publication Type
PhD Dissertation
Version
publishedVersion
Publication Date
3-2025
Abstract
High prescription drug prices in the US are a major hurdle on the road to improved public health. On a per-capita basis, US prescription drug spending is more than twice that of comparable OECD peer nations and yet the health outcomes achieved are worse. Policymakers try to implement countermeasures, such as the Inflation Reduction Act of 2022, to reduce the burden on the public but these countermeasures may result in unintended consequences. In this thesis, I study the effectiveness of two of these countermeasures and their unintended consequences. My first essay investigates prescription (Rx) to over the counter (OTC) drug switches in the US which is one of the measures implemented by policy makers to grant more autonomy and savings to the public. Specifically, I investigate the effect of Rx-to-OTC switches on prices of competing prescription drugs and find that they increase by about 10% after an Rx-to-OTC switch. While there may be net benefits to the public healthcare system due to the switches, patients who remain behind in the Rx market end up being worse off. My second essay is regarding the state-level biosimilar substitution laws in US, which are passed by policymakers to encourage easier substitution of expensive biologic drugs with cheaper biosimilars. Specifically, I study the effect of passing state-level biosimilar substitution laws on monetary payments made by pharmaceutical firms to physicians, which is a prevalent marketing practice that has been proven to have a strong influence on physician prescribing behavior. I find that passage of these laws increases the physician payments made by branded biologic firms by about 16%. While the biosimilar substitution laws remove some barriers for biosimilar adoption, the increased physician payments may create new barriers that slowdown biosimilar adoption.
Keywords
Pharmaceutical marketing, Public policy, Prescription drugs, Propensity score matching, Synthetic control method
Degree Awarded
PhD in Business (Marketing)
Discipline
Marketing
Supervisor(s)
CHANDUKALA, Sandeep Rao; OSINGA, Ernst Christiaan
First Page
1
Last Page
128
Publisher
Singapore Management University
City or Country
Singapore
Citation
NARNINDI, Rahul.
An empirical analysis of pricing and payments in the pharmaceutical industry. (2025). 1-128.
Available at: https://ink.library.smu.edu.sg/etd_coll/679
Copyright Owner and License
Author
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.