Graduation Year

Spring 2014

Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts

Department

Science and Management

Reader 1

Eric Helland

Terms of Use & License Information

Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© 2014 Christopher J. Albanese

Abstract

This paper attempts to estimate the change in sales associated with pharmaceutical patent expiration. Using data from the Medical Expenditure Panel Survey and patent expiration information from historical Orange Book publications, I estimated monthly sales associated with choice pharmaceutical patents. I then used a fixed-effects model to estimate the average change in sales before and after initial patent expiration, controlling for patent extension factors. My findings support that pharmaceutical patent expiration results in a statistically significant drop in sales by 38% on average within this sample, and further, that patent extensions had a negligible effect on this relationship. The question of patent expiration’s effect on sale is economically important for the sake of evaluating the efficacy of pharmaceutical patent law in protecting the interests of brand-name and generic drug manufacturers as well as paying consumers.

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