Publication
Jul 2013
This paper argues that in pharmaceutical markets, variation in the arrival time of consumer heterogeneity creates differences between a producer’s ability to extract consumer surplus with preventives and treatments, potentially distorting R&D decisions. For example, the authors' research shows that the US distribution of HIV risk would lead firms to earn only half the revenue from a vaccine as from a drug. This means that preventative vaccines are less likely to be developed for such diseases.
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English (PDF, 45 pages, 554 KB) |
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Author | Michael Kremer, Christopher M Snyder |
Series | CGD Working Papers |
Issue | 334 |
Publisher | Center for Global Development (CGD) |
Copyright | © 2013 Center for Global Development (CGD) |