【Micro/Empirical Seminar】The Welfare Effects of Reverse Payment Settlements in Pharmaceuticals
2026/04/23
研討會日期 : 2026-04-23
時間 : 14:30
主講人 : Dr. Hayley Wabiszewski
地點 : Conference Room B110
主持人 : Professor Leo Lam
演講者簡介 : Dr. Hayley Wabiszewski received her Ph.D. in Economics from Washington University in St. Louis in 2024. She is currently the Sorenson Post-Doctoral Fellow at the University of Utah. Her research interests are Industrial Organization, Health Economics, Innovation, Microeconomics, and Firm Strategy.
演講摘要 : According to the Federal Trade Commission, one of its top priorities in recent years has been opposing reverse payment settlements in the pharmaceutical industry. These "pay-for-delay" settlements prevent generic entry; the branded drug firm/patent holder pays the generic drug firm/patent challenger to abandon litigation and delay the introduction of its generic drug into the market. This paper seeks to analyze the welfare effects of reverse payment settlements in the U.S. antidepressant drug market, where three settlements with evidence of reverse payments occurred from 2002 – 2010. First, using details of the settlements derived from FTC cases, class action lawsuits, and other firm disclosures, a counterfactual entry date is posited, the date that generic entry may have occurred if not for the settlement. Next, a discrete choice, differentiated products model of demand for antidepressant drugs is estimated. The short-run change in welfare due to pay-for-delay can be estimated using the model together with the counterfactual entry date. In the short run, consumers are expected to gain from earlier entry of lower-price generics and producers lose as monopoly profits are dissipated. The effect on long-run consumer welfare is ambiguous, as lower profits for producers may lead to reduced investment in new drugs in the future.
