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This book comprises ten papers and a panel discussion on public policies toward the pharmaceutical research and development process.

Part I: "The Research and Development Process: The Implications of Economic Factors" contains papers analyzing the level and composition of industry R&D expenditures and the effects of changing expectations on the structure of the industry.

Part II: "The Research and Development Process: Decision-Making in a Regulated Industry" presents two papers about how pharmaceutical firms have responded to regulation, one comparing their R&D decisions in the 1960s and 1970s and the other about the economics of clinical testing.

Part III: "Competition among Drugs: The Role of Prices and Patents" assesses the "competitiveness" of the drug industry on the basis of drug price changes in the Netherlands and the United States; another paper looks at changes in market shares of drugs after their patents expire.

Part IV: "The Economics of Drug Choice" contains a paper analyzing how physicians learn about, choose, and use drugs. A second paper analyzes how the drug industry responds to physicians' demands for information and new products.

Part V: "The Social Returns to Pharmaceutical Research and Development" explores the effects of a major new ulcer drug, cimetidine, on health care expenditures and discusses the methodology of cost-benefit analysis  in health. A second paper analyzes the effects of public policy on the social benefit derived from innovation and imitation of drugs.

Part VI: "Drugs and Health: What Research Agenda for Public Policy?" presents a discussion among academics, government officials, and medical experts about the direction of research relating to the regulation of drug safety.

Robert B. Helms is a resident scholar at AEI.