The Impact of Pharmaceutical Innovation on Longevity and Medical Expenditure in Sweden, 1997-2010: Evidence from Longitudinal, Disease-Level Data

43 Pages Posted: 22 Aug 2012

See all articles by Frank R. Lichtenberg

Frank R. Lichtenberg

Columbia Business School - Finance and Economics; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Billie Pettersson

affiliation not provided to SSRN

Date Written: July 31, 2012

Abstract

We use longitudinal, disease-level data to analyze the impact of pharmaceutical innovation on longevity and medical expenditure in Sweden, where mean age at death increased by 1.88 years during the period 1997-2010. Pharmaceutical innovation is estimated to have increased mean age at death by 0.60 years during the period. The estimates indicate that longevity depends on the number of drugs to treat a disease, not the number of drug classes. Pharmaceutical innovation also reduced hospital utilization in Sweden, so the cost per life-year gained from the introduction of new drugs was quite low.

Keywords: longevity, pharmaceutical, innovation, drugs, Sweden

JEL Classification: I120, J110, L650, O330

Suggested Citation

Lichtenberg, Frank R. and Pettersson, Billie, The Impact of Pharmaceutical Innovation on Longevity and Medical Expenditure in Sweden, 1997-2010: Evidence from Longitudinal, Disease-Level Data (July 31, 2012). CESifo Working Paper Series No. 3894, Available at SSRN: https://ssrn.com/abstract=2133128

Frank R. Lichtenberg (Contact Author)

Columbia Business School - Finance and Economics ( email )

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National Bureau of Economic Research (NBER)

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CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Germany

Billie Pettersson

affiliation not provided to SSRN ( email )

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