The Global Entry of New Pharmaceuticals: A Joint Investigation of Launch Window and Price

55 Pages Posted: 31 May 2011

See all articles by I. Verniers

I. Verniers

affiliation not provided to SSRN

S. Stremersch

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Christophe Croux

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES); Catholic University of Leuven (KUL) - Department of Applied Economics

Date Written: May 3, 2011

Abstract

Research on the launch of new products in the international realm is scarce. The present paper is the first to document how launch window (difference in months between the first worldwide launch and the subsequent launch in a specific country) and launch price are interrelated and how regulation influences both launch window and launch price. The research context is the global - 50 countries worldwide - launch of 58 new ethical drugs across 29 therapeutic areas. We show that the fastest launch occurs when the launch price is moderately high and the highest launch price occurs at a launch window of 85 months. We find that the health regulator acts strategically in that the extent to which it delays the launch of a new drug increases with the price of the new drug. We also find that regulation overall increases the launch window, except for patent protection. Surprisingly, regulation does not directly impact launch price. The descriptive information on average launch window and launch price and the interconnection between launch window and launch price allows managers in ethical drug companies to build more informed decisions for international market entry. This study also provides public policy analysts with more quantitative evidence regarding launch window and launch price on a broad sample of countries and categories.

Keywords: regulation, pharmaceutical, entry timing, launch price, launch window, international new product launch

JEL Classification: M, C44, M31

Suggested Citation

Verniers, I. and Stremersch, Stefan and Croux, Christophe, The Global Entry of New Pharmaceuticals: A Joint Investigation of Launch Window and Price (May 3, 2011). ERIM Report Series Reference No. ERS-2011-010-MKT, Available at SSRN: https://ssrn.com/abstract=1855845

I. Verniers (Contact Author)

affiliation not provided to SSRN

No Address Available

Stefan Stremersch

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands
+31 10 408 8719 (Phone)
+31 10 408 9160 (Fax)

Christophe Croux

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES) ( email )

Ave. Franklin D Roosevelt, 50 - C.P. 114
Brussels, B-1050
Belgium

Catholic University of Leuven (KUL) - Department of Applied Economics ( email )

Leuven, B-3000
Belgium

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