Interstate trade barriers—laws, regulations, and administrative practices that hamper the flow of goods and services from state to state—have been persistent elements of the U. S. economy. This article pursues some implications of the U.S. experience for the European Community and for macromarketing and managerial practice, theory, and policy.
The sensitive nature of pharmaceuticals and the high cost of research and commercialization to introduce new products have led to numerous regulations intended to ensure the availability of safe and effective drug products. An unintended result has been to increase the cost of product introductions into various markets. The authors empirically test the relationship among the types of regulation, pharmaceutical product introductions, and the timing of their entry into the six largest country markets from 1970 to 1989. Surprisingly, the findings show that the type of regulation affects timing more than the number of new product introductions. The authors address the drug lag across the largest country markets on a product level over a period of 20 years. They discuss important potential implications for public policy and society.
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