An assessment of the Therapeutic Biologic products licensed by the FDA and the EMA

Abstract

A73scheme, prices of brand-name and generic drugs are to be set to the same level after the patent expires. METHODS: The data used for this study were extracted from the National Health Insurance Claims database. We established a monthly panel dataset pertaining to pharmaceutical consumption between January 2011 and June 2013 (30 months). Proxies of market competition were considered as dependent variables such as price dispersion, market share of originators and relative ratio of utilization (originator/generics). Independent variables including policy effect, number of generic drugs, vintages of the first generic drugs, month for new generic entry and market value. RESULTS: The new pricing policy has resulted in no competition mechanism. Rather the policy shows more favorable to originators than generic drugs. Price dispersion has significantly decreased to 0.92 after the new pricing regulations. Market share of the originators has not significantly changed. However, originator-to-generic utilization ratio significantly increased to 6.12 (p< 0.001) after the new policy. This study offers different results to the government's intention. CONCLUSIONS: Price competition cannot be successfully achievable unless demand-side measures are combined. To lower prices, the bigger market share should be delivered through demand-side measures such as the reference pricing or compulsory substitution to lowest drugs applied in some European countries.