@techreport{NBERw13857,
 title = "The Impact of Medicare Part D on Pharmaceutical R&D",
 author = "Margaret E. Blume-Kohout and Neeraj Sood",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "13857",
 year = "2008",
 month = "March",
 URL = "http://www.nber.org/papers/w13857",
 abstract = {Recent evidence suggests that Medicare Part D has increased prescription drug use among the elderly, and earlier studies have indicated that increasing market size induces pharmaceutical innovation.  This paper assesses the impact of Medicare Part D on pharmaceutical research and development (R&D), using time-series data on (a) the number of drugs in clinical development by therapeutic class, and (b) R&D expenditures by firm.  We demonstrate that the passage of Medicare Part D was associated with significantly higher pharmaceutical R&D for drug classes with higher Medicare market share, and for firms specializing in higher-Medicare-share drugs.},
}