ECONOMIC THEORY

Economic Theory

Economic Theory

Introduction

In health care, supply prices, received by the manufacturer are different from demand prices, which are paid, by the patient due to health insurance. The insurer, while creating the benefit, decides what prices patients need to spend for drugs and other products. In such a case, the characterization of cost and supply conditions in markets for generic and branded drugs, along with the application of basic tools of microeconomics to describe how an insurer, acting on behalf of its enrollees, would set demand prices for drugs becomes very important. The risks associated with research and development ...