TY  - JOUR
AU  - Cawley,John
AU  - Rizzo,John A.
TI  - The Competitive Effects of Drug Withdrawals
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 11223
PY  - 2005
Y2  - March 2005
UR  - http://www.nber.org/papers/w11223
L1  - http://www.nber.org/papers/w11223.pdf
N1  - Author contact info:
John Cawley
3M24 MVR Hall
Department of Policy Analysis and Management
and Department of Economics
Cornell University
Ithaca, NY  14853
Tel: 607/255-0952
Fax: 607/255-4071
E-Mail: jhc38@cornell.edu

John Rizzo
Stony Brook University
N-637 Social and Behavioral Sciences Bldg.
Stony Brook, NY 11794
E-Mail: John.Rizzo@stonybrook.edu
AB  - In September 1997, the anti-obesity drugs Pondimin and Redux, ingredients in the popular drug combination fen-phen, were withdrawn from the market for causing potentially fatal side effects. That event provides an opportunity for studying how consumers respond to drug withdrawals. In theory, remaining drugs in the therapeutic class could enjoy competitive benefits, or suffer negative spillovers, from the withdrawal of a competing drug. Our findings suggest that, while the withdrawal of a rival drug may impose negative spillovers in the form of higher patient quit rates, on the whole non-withdrawn drugs in the same therapeutic class enjoy competitive benefits in the form of higher utilization.
ER  -