Movies, stigma and choice: Evidence from the pharmaceutical industry.

Do movies reduce stigma, increasing healthcare product choices offered by firms? We provide causal evidence on this question in the context of Indian pharmaceutical markets. For unpacking these effects, we use an exogenous shock to the market due to the release of a Bollywood blockbuster movie - My Name is Khan (MNIK) where the protagonist, superstar Shahrukh Khan, suffers from Asperger's Syndrome (AS). Using a difference-in-differences design, we find a positive and statistically significant effect of MNIK (between 14% and 22% increase in variety sold and prescribed) on product differentiation and choices in the market for antipsychotic medicines used to clinically treat AS. Results are consistent using alternative controls, a placebo treatment-based test and with a variety of other robustness checks. Our findings document likely for the first-time, supply side responses to edutainment and suggests potential associated welfare effects in healthcare markets characterized by sticky demand. Implications for global health and public policy given worldwide concerns around a mental wellness epidemic with Covid-19 are discussed.

Pandemics and technology engagement: New evidence from m-Health intervention during COVID-19 in India.

Information provision for social welfare via cheap technological media is now a widely available tool used by policymakers. Often, however, an ample supply of information does not translate into high consumption of information due to various frictions in demand, possibly stemming from the pecuniary and non-pecuniary cost of engagement, along with institutional factors. We test this hypothesis in the Indian context using a unique data set comprising 2 million call records of enrolled users of ARMMAN, a Mumbai-based nongovernmental organization that sends timely informational calls to mobile phones of less-privileged pregnant women. The strict lockdown induced by COVID-19 in India was an unexpected shock on engagement with m-Health technology, in terms of both reductions in market wages and increased time availability at home. Using a difference-in-differences design on unique calls tracked at the user-time level with fine-grained time-stamps on calls, we find that during the lockdown period, the call durations increased by 1.53 percentage points. However, technology engagement behavior exhibited demographic heterogeneity increasing relatively after the lockdown for women who had to borrow the phones vis-à-vis phone owners, for those enrolled in direct outreach programs vis-à-vis self-registered women, and for those who belonged to the low-income group vis-à-vis high-income group. These findings are robust with coarsened exact matching and with a placebo test for a 2017-2018 sample. Our results have policy implications around demand-side frictions for technology engagement in developing economies and maternal health.

Unpacking the effects of adverse regulatory events: Evidence from pharmaceutical relabeling.

We provide causal evidence that regulation induced product shocks significantly impact aggregate demand and firm performance in pharmaceutical markets. Event study results suggest an average loss between $569 million and $882 million. Affected products lose, on average, $186 million over their remaining effective patent life. This leaves a loss of between $383 million and $696 million attributable to declines in future innovation. Our findings complement research that shows drugs receiving expedited review are more likely to suffer from regulation induced product shocks. Thus, it appears we may be trading off quicker access to drugs today for less innovation tomorrow. Results remain robust to variation across types of relabeling, market sizes, and levels of competition.

Did India's price control policy for coronary stents create unintended consequences?

In February 2017, India capped the retail price of coronary stents and restricted the channel margin to bring Percutaneous Transluminal Coronary Angioplasty (PTCA) procedure, which uses coronary stents, within reach of millions of patients who previously could not afford it. Prior research shows that care providers respond to such regulations in a way that compensates for their loss in profits because of price control. Therefore, price control policies often introduce unintended consequences, such as distortions in clinical decision making. We investigate such distortions through empirical analysis of claims data from a representative public insurance program in the Indian state of Karnataka. Our data comprises 25,769 insurance claims from 69 private and seven public hospitals from February 2016 to February 2018. The public insurance context is ideal for investigating distortions in clinical decisions as the price paid by patients, and thereby access to the treatment, does not change after price control. We find that the change in the average volume of PTCA procedures per hospital per month after price control disproportionately increased when compared to the change in the clinical alternative - Coronary Artery Bypass Graft (CABG) procedures. This increase corresponds to 6% of the average number of PTCA procedures and 28% of the average number of CABG procedures before the price control. In addition, disproportionate increase in PTCA procedures occurred only among private hospitals, indicating the possibility of profit-maximization intentions driving the clinical choices. Such clinical distortions can have negative implications for patient health outcomes in the long run. We discuss alternative policies to improve access and affordability to healthcare products and services which are likely to not suffer from similar distortions.

From courts to markets: New evidence on enforcement of pharmaceutical bans in India.

Regulatory enforcement of product safety standards given health concerns, whether it is in romaine lettuce, smartphones or cars, is emerging to be a challenge for global public health. This is particularly true for developing economies with fragile institutions. In this context, recent studies on Indian pharmaceutical markets provide evidence suggesting that the sector is a hub for substandard quality of medicines. Departing from these prior studies which use randomly collected samples, we reinvestigate this question using novel pan-India market sales data of banned medicines from 0.75 million pharmacists and chemists in India. We find that indeed such medicines get sold in India even after bans are imposed on them in the period 2007 to 2013. However, there is a general decline in demand post ban for our focal molecules suggesting broad adherence to bans. We also observe regional heterogeneity in prevalence of banned medicines sold between rich and poor regions of India with the former counterintuitively showing more sales. That said, while Ozawa et al. (2018) argue that prevalence of substandard medicines is around 13% in low and middle-income countries, we find an infringement ratio which is more muted in India at about 5%. Finally, a regression-based examination suggests that prior firm presence in therapeutic markets and popularity of molecules positively impact the likelihood of sale of banned medicines in India. Our results are robust to alternative explanations and are substantiated with a theoretical set up examining firm trade-offs in the decision to infringe. India has recently been under the lens of the global access to medicines debate and our findings have important policy implications for global health.

Government health insurance and spatial peer effects: New evidence from India.

What is the role of spatial peers in diffusion of information about health care? We use the implementation of a health insurance program in Karnataka, India that provided free tertiary care to poor households to explore this issue. We use administrative data on location of patient, condition for which the patient was hospitalized and date of hospitalization (10,507 observations) from this program starting November 2009 to June 2011 for 19 months to analyze spatial and temporal clustering of tertiary care. We find that the use of healthcare today is associated with an increase in healthcare use in the same local area (group of villages) in future time periods and this association persists even after we control for (1) local area fixed effects to account for time invariant factors related to disease prevalence and (2) local area specific time fixed effects to control for differential trends in health and insurance related outreach activities. In particular, we find that 1 new hospitalization today results in 0.35 additional future hospitalizations for the same condition in the same local area. We also document that these effects are stronger in densely populated areas and become pronounced as the insurance program becomes more mature suggesting that word of mouth diffusion of information might be an explanation for our findings. We conclude by discussing implications of our results for healthcare policy in developing economies.

The role of physicians in prescribing irrational fixed-dose combination medicines in India.

Many irrational fixed-dose combination (FDC) medicines have been approved by the state and central regulatory authorities in India and their use is promoted extensively by pharmaceutical firms. In this study, we examine the previously-neglected role of physicians in India, as their prescriptions are essential for the continued proliferation of FDCs. Primarily using longitudinal data on prescriptions by 4600 physicians spanning 19 disciplinary categories for 48 months between 2008 and 2011 provided by IMS Medical Audit, we study 201 medicines in the cardiovascular and oral-antidiabetic markets. We find that 129.6 million (8.1%) prescriptions for irrational FDCs were written by the sample of physicians in India during the study period, half of which were written by cardiologists and consulting physicians. A further analysis of the regional markets reveals that cardiologists prescribe more irrational FDCs in the richer, metropolitan cities of western India. We also document the role of medical practitioners without an undergraduate degree in medicine in generating prescriptions for irrational FDCs. Our results suggest that an effective government strategy to curb irrational FDCs must recognize that spreading greater awareness about the perils of irrational FDCs is at best an incomplete solution to the problem in India as many who prescribe them are specialists. Organizations such as the Indian Medical Association must develop clear guidelines to stop prescribing such FDCs.

Mitigating regulatory impact: the case of partial price controls on metformin in India.

The use of drug price controls is a contentious issue globally. Low- and middle-income countries use direct price controls to improve access to essential drugs. But such price controls have little meaning if they are not designed and implemented well, and the extent to which firms coordinate in these countries to weaken price controls has been largely overlooked. In mid-2013, India adopted partial price-cap regulation for some, but not all, formulations of several essential medicines. Using data on sales and prices of the out-of-patent oral antidiabetic drug Metformin­considered essential by WHO since 1998­and employing the differences-in-differences methodology, we examine the impact of the regulation on curbing prices. We find that firms coordinated to increase the price of the regulated formulation in the period before regulation, which led to a higher ceiling price. We also find, using triple-differences analyses, that the coordination is stronger among larger firms and for time-release formulations. We present anecdotal evidence to suggest that pharmaceutical trade associations facilitated coordination among firms, and we conclude that partial price control of Metformin in India is, at best, a modest improvement over no regulation.

The consumer welfare implications of governmental policies and firm strategy in markets for medicines.

This paper empirically examines the consumer welfare implications of changes in government policies related to patent protection and compulsory licensing in the Indian market for oral anti-diabetic (OAD) medicines. In contrast to previous studies on the impact of pharmaceutical patents in India, we observe, and estimate the welfare effects accruing from differential pricing and voluntary licensing strategies of patent-holding innovator firms. Three novel molecules belonging to the dipeptidyl peptidase-4 (DPP-4) inhibitor class of OADs have been launched in India by the patent holders, at lower prices than those prevailing in the developed countries. Using aggregate market transaction data, we structurally estimate demand and supply and use the parameter estimates in our model to simulate consumer welfare under various counterfactual scenarios. Our results suggest that the introduction of DPP-4 inhibitors generated a consumer surplus gain of around 7.6 cents per day for a typical DPP-4 inhibitor user under the existing differential pricing and voluntary licensing strategies. If the innovators decide to price at developed-country levels, this surplus is eliminated almost entirely. The issuance of compulsory licensing does not always improve consumer welfare because if innovators defer or delay the introduction of new drugs in response, the loss in consumer welfare could be substantial.

Innovation policy instruments (non-price) for medical innovation

Innovation policy instruments are policy interventions with a specific mechanism of action that influences the innovation process. This Oslo Medicines Initiative technical report presents a broad range of such instruments available to national policy-makers in support of innovation for new medicines (excluding those focused on price, which are covered elsewhere in the report series). This report explores various types of policy instrument, based on reviews of the literature on policies for innovation in the medical and other sectors. For each type identified, the report explores the mechanisms of action, the effects these have and where they occur, and the extent to which these instruments have been implemented globally. It also sets out considerations for their effective implementation. The report demonstrates that the long-established push/pull (supply/demand) framing that dominates discourse around medical innovation can be broadened, providing policy-makers with instruments to supplement push/pull approaches, by emphasizing the role of communication, collaboration and coordination in supporting the emergence of medicines to address societal needs.

Инструменты политики (не связанные с ценовыми факторами) в поддержку инноваций в области медицины: Технический доклад Инициативы Осло по лекарственным средствам: основные положения.

Под инструментами инновационной политики имеются в виду вмешательства в сферу политики с особым механизмом действия, который оказывает влияние на процесс нововведений. В техническом докладе Инициативы Осло по лекарственным средствам представлен широкий диапазон таких инструментов для использования национальными органами, отвечающими за формирование политики, в поддержку инноваций в области новых лекарственных препаратов (за исключением тех, которые ориентированы на факторы цены, о чем говорится в других материалах серии докладов). Этот доклад посвящен анализу различных типов инструментов политики, проведенному в результате обзора литературных источников по вопросам инновационной политики в медицинском и других секторах. По каждому из этих типов в отчете дается описание их механизмов действий, характера воздействия и в чем он проявляется, а также уточняется размах внедрения этих инструментов в практику в глобальном масштабе. Здесь также изложены соображения по эффективному осуществлению таких механизмов. Доклад наглядно показывает, что давно сложившуюся пуш/пул-конструкцию (соотношение спроса и предложения), занимающую доминирующее положение в связи с полемикой вокруг нововведений в области медицины, можно расширить, вооружив определяющих политику лиц инструментами в дополнение к пуш/пул-подходам через актуализацию функции коммуникации, сотрудничества и координации в процессе содействия появлению новых лекарственных средств для удовлетворения потребностей населения.