The analysis model was based on monthly observations for 109 patients and showed that prices have a negative impact on transitions in the sense that an increase in the brand price will reduce the transition from generics to brand and likewise an increase in the generic price will reduce the transition from brand to generics.

The two brand-name products on the Norwegian market were Provachol (pravastatin) and Zocor (simvastatin). The generics were Provastatine (pravastatin) and Simastatine (simvastatin).

In addition to the expected price effects the authors also found that the older a male doctor is the more likely it is that he continues to prescribe the brand-name product, whereas patient’s age and gender had no significant impact.

This study highlights the importance of appropriate pricing for generic penetration to be effective and also shows the need for physicians—especially those more set in their ways—to be educated in generic prescribing.

Reference

1. Dalen MD, Locatelli M, Strøm S. Longitudinal analysis of generic substitution. Department of Economics Working Papers, University of Turin. Working paper No. 13/2010.