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Project Citation: 

Project Description

Summary:  View help for Summary This paper analyzes the relationship between postmarketing promotional activity and reporting of adverse drug reactions (ADRs) by modeling the interaction between a regulator (the FDA) and a pharmaceutical firm. Promotion-driven market expansions enhance profitability yet may involve the risk of inappropriate drug prescriptions, leading to regulatory actions against the firm. We empirically test the relationship between drug promotion and reporting of ADRs using an innovative combination of commercial data on pharmaceutical promotion and FDA data on regulatory interventions and ADRs. We provide some evidence that increased levels of promotion and advertising lead to increased reporting of ADRs for certain conditions. (JEL L51, L65, M31, M37)

Scope of Project

JEL Classification:  View help for JEL Classification
      M31 Marketing
      M37 Advertising
      L65 Chemicals • Rubber • Drugs • Biotechnology • Plastics
      L51 Economics of Regulation


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