Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/190943 
Authors: 
Year of Publication: 
2019
Series/Report no.: 
cege Discussion Papers No. 363
Publisher: 
University of Göttingen, Center for European, Governance and Economic Development Research (cege), Göttingen
Abstract: 
In this paper, I study the effect of a change in the mandatory manufacturer rebate on wholesale prices for pharmaceuticals on competition by parallel imports. First, I analyze the effect of a manufacturer rebate on competition by parallel imports in a two-country model. An increase in the manufacturer rebate increases the market share of parallel imports. Second, I exploit a policy reform in Germany in 2010 that increased the manufacturer rebate by 10 percentage points. Using a data set with prescription drugs with competition from parallel imports, I estimate the effect of the change in the manufacturer rebate on competition by parallel imports. Estimation results suggest that an increase in the manufacturer rebate has increased the market share of parallel imports.
Subjects: 
parallel imports
manufacturer rebate
pharmaceuticals
regulation
JEL: 
F12
I11
I18
Document Type: 
Working Paper

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