Has the European Union Achieved a Single Pharmaceutical Market?

33 Pages Posted: 16 Aug 2010

See all articles by Aysegul Timur

Aysegul Timur

Hodges University - Kenneth Oscar Johnson School of Business

Gabriel Picone

Department of Economics

Jeffrey S. DeSimone

University of Texas at Arlington - College of Business Administration - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: August 2010

Abstract

This paper explores price differences in the European Union (EU) pharmaceutical market, the EU's fifth largest industry. With the aim of enhancing quality of life along with industry competitiveness and R&D capability, many EU directives have been adopted to achieve a single EU-wide pharmaceutical market. Using annual 1994-2003 data on prices of molecules that treat cardiovascular disease, we examine whether drug price dispersion has indeed decreased across five EU countries. Hedonic regressions show that over time, cross-country price differences between Germany and three of the four other EU sample countries, France, Italy and Spain, have declined, with relative prices in all three as well as the fourth country, UK, rising during the period. We interpret this as evidence that the EU has come closer to achieving a single pharmaceutical market in response to increasing European Commission coordination efforts.

Suggested Citation

Timur, Aysegul and Picone, Gabriel and DeSimone, Jeffrey S., Has the European Union Achieved a Single Pharmaceutical Market? (August 2010). NBER Working Paper No. w16261. Available at SSRN: https://ssrn.com/abstract=1658288

Aysegul Timur (Contact Author)

Hodges University - Kenneth Oscar Johnson School of Business ( email )

2655 Northbrooke Dr.
Naples, FL 34119
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Gabriel Picone

Department of Economics ( email )

4202 E. Fowler Avenue
Tampa, FL 33620-5500
United States
813-974-6537 (Phone)
813-974-6510 (Fax)

HOME PAGE: http://www.coba.usf.edu/departments/economics/facu

Jeffrey S. DeSimone

University of Texas at Arlington - College of Business Administration - Department of Economics ( email )

Box 19479 UTA
Arlington, TX 76019
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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