'Me-Too' Innovation in Pharmaceutical Markets.

Critics of me-too innovation often argue that follow-on drugs offer little incremental clinical value over existing pioneer products, while at the same time increasing health care costs. We examine whether consumers view follow-on and pioneer drugs as close substitutes or distinct clinical therapies. For five major classes of drugs, we find that large reductions in the price of pioneer molecules after patent expiration-which would typically lead to decreased consumption of strong substitutes-have no effect on the trend in demand for follow-on drugs.

An assessment of direct-to-consumer advertising of prescription drugs.

Advertising is widely seen by economists and regulators as beneficial to markets and consumers. The prescription drug market offers exceptional opportunities for direct-to-consumer advertising (DTCA) to provide new-product information, improve compliance, alleviate widespread underdiagnosis and undertreatment, and motivate new-product development.5 DTCA can also induce excess or even dangerous prescribing, however, partly because patients are poorly informed and usually pay far less than the full cost of drugs.

The emerging market dynamics of targeted therapeutics.

Targeted biotech drugs that attack specific biological molecules that cause disease are bringing new benefits even as they foment pricing dynamics that are very different from those of traditional drugs. Targeted drugs tend not to compete with each other even when treating closely related diseases, which makes them resistant to price controls. We can expect the supply of expensive new so-called biotech drugs to continue.

What do we know about direct-to-consumer advertising of prescription drugs?

Two papers, by Joel Weissman and colleagues and by Robert Dubois, add to our limited knowledge of the effects of direct-to-consumer (DTC) advertising of prescription drugs. Their results reinforce the largely positive findings from consumer surveys, while adding valuable new data and insights. These suggest that DTC ads probably improve patients' health outcomes and do not tend to lead to inappropriate prescribing.

The role of marketing in pharmaceutical research and development.

Pharmaceutical marketing, which is primarily targeted at physicians, has been criticised because it may distort physician prescribing and thus potentially raise costs and/or worsen health. An alternative view, presented in this paper, is that successful marketing of pharmaceuticals can improve consumer welfare by increasing incentives for research and development (R&D) investment and by providing guidance to R&D to make it more consistent with consumer preferences. There are a number of arguments that support this view, despite impediments to pharmaceutical marketing such as the prohibited dissemination of off-label information in the US, difficulties in estimating potential pharmaceutical demand, and the long time lag between demand assessment and the introduction of new drugs.

Pharmaceutical price controls and patient welfare.

Price controls could have a substantial negative effect on pharmaceutical research and development. Extensive research is required before the development costs of a new drug or its benefits are known; most new drug development projects fail, sometimes after substantial financial and time costs. These conditions pose intractable practical problems for the operation of price controls, which cannot rest on objective, predictable standards such as the benefits or costs of individual drugs.

The increasing necessity for market-based pharmaceutical prices.

In most markets, research and development are driven by expected prices, and those prices are determined mainly by consumer willingness to pay for the potential benefits of new products. In the pharmaceutical market, however, the dominant role of government and tax-induced insurance has tended to create a wedge between expected prices and consumer willingness to pay to cure or prevent disease. This distorts investment decisions, tending to cause underinvestment.

Low profiles of salivary progesterone among college undergraduate women.

High incidences of amenorrhea and oligomenorrhea are often found among late adolescent, college-aged women. We studied menstrual profiles of salivary progesterone in 17 undergraduate women (average age 20.2 years) who were experiencing regular menstrual cycles, and compared the results with similar data obtained from older women, both recreational runners (30.