Healthy Skepticism Library item: 10201

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: Journal Article

Konigbauer I.
Advertising and generic market entry.
J Health Econ 2007 Mar 1; 26:(2):286-305
http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V8K-4M1CYRB-1&_user=10&_coverDate=03%2F01%2F2007&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=6a2bf992100e2f880578bbd8c71b6c7b

Abstract:

The effect of purely persuasive advertising on generic market entry and social welfare is analysed. An incumbent has the possibility to invest in advertising which affects the prescribing physician’s perceived relative qualities of the brand-name and the generic version of the drug. Advertising creates product differentiation and can induce generic market entry which is deterred without differentiation due to strong Bertrand competition. However, over-investment in advertising can deter generic market entry under certain conditions and reduces welfare as compared to accommodated market entry.

Keywords:
Advertising; Pharmaceuticals; Generic entry; Social welfare Publication Types: Research Support, Non-U.S. Gov't MeSH Terms: Advertising* Drugs, Generic* Economic Competition*/statistics & numerical data Germany Humans Models, Statistical Social Welfare Substances: Drugs, Generic