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How Do Copayment Coupons Affect Branded Drug Prices and Quantities Purchased? / Leemore Dafny, Kate Ho, Edward Kong.
- Format:
- Book
- Author/Creator:
- Dafny, Leemore.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w29735.
- NBER working paper series no. w29735
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2022.
- Summary:
- We estimate the causal effects of drug copayment coupons, which reduce consumer cost-sharing for branded prescription drugs, on net-of-rebate price and quantities sold. Focusing on drugs without generic substitutes, we show that coupon introductions increase quantity sold by 23-25% for the commercial segment relative to Medicare Advantage, where coupons are banned. To quantify the resulting equilibrium price effects, we estimate a discrete choice model of demand for multiple sclerosis drugs and simulate a model of drug price negotiations. We estimate that net-of-rebate prices are 8% higher due to the availability of coupons for most of these drugs.
- Notes:
- Print version record
- February 2022.
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