Data and code for: "Does entry remedy collusion? Evidence from the generic prescription drug cartel"

Principal Investigator(s): View help for Principal Investigator(s) Amanda Starc, Northwestern University Kellogg School of Management; Thomas Wollmann, University of Chicago. Booth School of Business

Version: View help for Version V1

Name	File Type	Size	Last Modified
ado			01/21/2025 12:46:PM
input			08/22/2024 06:20:PM
Manifest.toml	text/plain	20.3 KB	01/20/2025 02:57:PM
Project.toml	text/plain	5 KB	01/20/2025 02:57:PM
README.pdf	application/pdf	940.3 KB	01/21/2025 07:32:AM
Step_0_instantiate.jl	text/x-common-lisp	47 bytes	01/20/2025 02:57:PM
Step_1.do	text/plain	5.2 KB	01/20/2025 02:57:PM
Step_2_markups_for_bcs.jl	text/x-common-lisp	2.9 KB	01/20/2025 02:57:PM
Step_3_bcs_analysis.do	text/plain	7.5 KB	01/20/2025 02:57:PM
Step_4_entry_values_for_sc.jl	text/x-common-lisp	4.1 KB	01/20/2025 02:57:PM

Project Citation:

Starc, Amanda, and Wollmann, Thomas. Data and code for: “Does entry remedy collusion? Evidence from the generic prescription drug cartel.” Nashville, TN: American Economic Association [publisher], 2025. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2025-03-26. https://doi.org/10.3886/E200001V1

Project Description

Summary:

This workspace contains data and code for the article "Does entry remedy collusion? Evidence from the generic prescription drug cartel." The article is summarized as follows.

Entry represents a fundamental threat to cartels. We study the extent and effect of this behavior in the largest price-fixing case in US history, which involves generic drug manufacturing. We link information on the cartel’s internal operations to regulatory filings and market data. There is a substantial increase in entry after cartel formation but regulatory approvals delay most entrants by 2-4 years. We then estimate a structural model to simulate counterfactual equilibria. Absent entry, cartel profits would be dramatically higher. Correspondingly, reducing regulatory delays by just 1-2 years equates to consumer compensating variation of $559 million-$1.3 billion.

Scope of Project

Subject Terms: collusion; cartel; entry; pharmaceutical; generic drugs

JEL Classification:
      L11 Production, Pricing, and Market Structure; Size Distribution of Firms
      L41 Monopolization; Horizontal Anticompetitive Practices
      L65 Chemicals; Rubber; Drugs; Biotechnology; Plastics

Geographic Coverage: United States

Time Period(s): 2008 – 2020

Data Type(s): event/transaction data; observational data

Methodology

Data Source:

Conn. et al v. Teva Pharm. USA, Inc. 2019. https://portal.ct.gov/-/media/AG/Press_Releases/2019/FINAL-UNREDACTED-Teva-Complaint-for-CT-District....

Feldman, Robin, Evan Frondorf, Andrew Cordova, and Connie Wang. 2016. “Database from Empirical Evidence of Drug Pricing Games - A Citizen’s Pathway Gone Astray [Online data file].” https://ssrn.com/abstract=2924673.

IQVIA. 2022. “National Prescription Audit and IQVIA Institute Services [Data file].” https://www.accessdata.fda.gov/scripts/cder/daf/index.cfm.

Centers for Medicare & Medicaid. 2022a. “State Drug Utilization Data [Online data file].” https://www.medicaid.gov/medicaid/prescription-drugs/state-drug-utilization-data/index.html.

Centers for Medicare & Medicaid. 2022b. “National Average Drug Acquisition Cost [Online data file].” https://data.medicaid.gov/dataset/99315a95-37ac-4eee-946a-3c523b4c481eoverview.

Teva Pharmaceuticals Industries. 2011-2016. “Report 20-F.” https://ir.tevapharm.com/financials/sec-filings/default.aspx.

US Food & Drug Administration. 2022a. “Approved Drug Products with Therapeutic Equivalence Evaluations — Orange Book [Online data file].” https://www.fda.gov/drugs/drug-approvals-and-databases/approved-drug-products-therapeutic-equivalenc....

US Food & Drug Administration. 2022b. “Drugs @ FDA [Online data file].” https://www.accessdata.fda.gov/scripts/cder/daf/index.cfm.

US Food & Drug Administration. 2022c. “First generic drug approvals [Online data file].” https://www.fda.gov/drugs/drug-and-biologic-approval-and-ind-activity-reports/first-generic-drug-app....

US Food & Drug Administration. 2022d. “National Drug Code Directory [Online data file].” https://www.fda.gov/drugs/drug-approvals-and-databases/national-drug-code-directory

Unit(s) of Observation: In the cross section, substance-delivery-release and substrance-delivery-release-strength. In the time series, quarter or year.

Geographic Unit: United States

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V1 [2025-03-26]

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