Perverse reverse price competition: Average wholesale prices and Medicaid pharmaceutical spending

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Perverse Reverse Price Competition: Average Wholesale Prices and Medicaid Pharmaceutical Spending

Generic drugs comprise an increasing share of total prescriptions dispensed in the U.S., rising from nearly 50 percent in 1999 to 75 percent in 2009. The generic drug market has typically been viewed at the wholesale level as a competitive market with price approaching marginal costs. However, the large presence of third party payers as final purchasers may distort prices at the retail level re...

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An article on the front page of the Wall Street Journal on October 6, 2006, thrust into the public media the otherwise esoteric controversy concerning the use of average wholesale price (AWP) as the primary basis for reimbursements to pharmacies for pharmaceuticals in the United States. Although used widely for nearly 40 years, AWP had been criticized prior to this investigative report as unrel...

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ژورنال

عنوان ژورنال: Journal of Public Economics

سال: 2013

ISSN: 0047-2727

DOI: 10.1016/j.jpubeco.2013.08.010