|Working Papers logo 130|
Increasing competition generally decreases product prices. But in the case of pharmaceuticals, this is only beneficial if competitor products are therapeutically equivalent (bioequivalent). One measure of quality control is a consistently made product, examined in detail in this paper. A comprehensive study of drug samples in African and Asian countries--assessed for variability by spectrometer--suggests that registered products perform notably better than unregistered products. As all of the sampled drugs are used to treat potentially lethal infections, this product variability (particularly of unregistered drugs) could prove detrimental to public health.
Future analysis will assess how significant these spectral differences are in terms of drug quality and hence how important changes in policy should be to limit quality variability.
Roger Bate is the Legatum Fellow in Global Prosperity at AEI.