A Cost-Benefit Analysis of the Medicines Patent Pool

32 Pages Posted: 2 Nov 2022 Last revised: 25 Aug 2023

See all articles by Lucy Xiaolu Wang

Lucy Xiaolu Wang

University of Massachusetts Amherst - Department of Resource Economics; Max Planck Institute for Innovation and Competition

Date Written: August 8, 2023

Abstract

Understanding the cost and benefit of global public health institutions is important but challenging. This study provides a cost-benefit analysis of the first public health-oriented patent pooling and licensing institution, the Medicines Patent Pool (MPP), which is devoted to improving generic drug licensing and supply in low- and middle-income countries. A simple structural model of demand and supply is estimated on a dataset that covers 103 LMIC and 29 HIV drugs with data on sales, MPP licenses, patents, country-year level diseases and demographics, and institutional factors during 2007-2017. Counterfactuals are simulated in the absence of the MPP or with further expansions. The estimated benefits to consumers and firms far exceed the operating costs.

Keywords: cost-benefit analysis, structural model, Medicines Patent Pool, drug access, low and middle-income countries

JEL Classification: O3, K2, I1

Suggested Citation

Wang, Lucy Xiaolu, A Cost-Benefit Analysis of the Medicines Patent Pool (August 8, 2023). Forthcoming in: Economics Bulletin, Max Planck Institute for Innovation & Competition Research Paper No. 23-18, Available at SSRN: https://ssrn.com/abstract=4262457 or http://dx.doi.org/10.2139/ssrn.4262457

Lucy Xiaolu Wang (Contact Author)

University of Massachusetts Amherst - Department of Resource Economics ( email )

Stockbridge Hall
80 Campus Center Way
Amherst, MA 01003
United States

HOME PAGE: http://www.lucyxiaoluwang.com/

Max Planck Institute for Innovation and Competition ( email )

Marstallplatz 1
Munich, Bayern 80539
Germany

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