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About the Author(s)

Ginger Zhe Jin

Ginger Zhe Jin received her PhD from UCLA in 2000 and is currently a professor of economics at the University of Maryland, College Park. She was on leave to the Federal Trade Commission in 2015–17, and served as director of the FTC's Bureau of Economics from January 2016 to July 2017. She has been an NBER research associate since 2012, and is a member of the bureau's Industrial Organization Program.

Most of Jin's research focuses on information asymmetry among economic agents and how to provide information to overcome this problem. She has studied restaurant food safety, health insurance, prescription drugs, e-commerce, online reviews, regulatory inspection, scientific innovation, air quality, blood donation, intrafamilial interaction, data security, and consumer protection. Her research has been published in economics, management, and marketing journals, and has been supported by the National Science Foundation, the Net Institute, and the Alfred P. Sloan Foundation. She is currently co-editor of the Journal of Economics and Management Strategy, associate editor of RAND Journal of Economics, and guest senior editor for a special issue of Marketing Science on consumer protection.

Endnotes

1. The FDA defines personal drug imports as those that represent a reasonable risk and are intended for personal use of no more than a three-month supply. An agency handbook on drug-product control states that when determining the legality of personal shipments, "FDA personnel may use their discretion to allow entry of shipments of violative FDA regulated products when the quantity and purpose are clearly for personal use, and the product does not present an unreasonable risk to the user." Go to ⤴︎
2. G. Orizio, A.Merla, P. Schulz, and U. Gelatti, "Quality of Online Pharmacies and Websites Selling Prescription Drugs: A Systematic Review," Journal of Medical Internet Research, 13(3), 2011. https://www.ncbi.nlm.nih.gov/pubmed/21965220   Go to ⤴︎
3. National Association of Boards of Pharmacy. "Internet Drug Outlet Identification Program Progress Report for State and Federal Regulators," January 2011.   Go to ⤴︎
4. LegitScript's certification criteria include a valid license with local US jurisdictions, a valid registration with the US Drug Enforcement Administration (DEA) if dispensing controlled substances, valid contact information, a valid domain name registration, a valid prescription, dispensing only FDA-approved drugs, and protecting user privacy according to the HIPAA Privacy Rule (45 CRF 164). There are more LegitScriptcertified websites than NABP-certified websites, probably because the NABP requires interested websites to apply and pay verification fees while LegitScript's approval is free and does not require website application.   Go to ⤴︎
5. Certification requirements on PharmacyChecker include the stipulation that any approved website must have a valid pharmacy license from its local pharmacy board, requires a prescription for US purchase if the FDA requires a prescription for the medication, protects consumer information, encrypts financial and personal information, and presents a valid mailing address and phone number for contact information.   Go to ⤴︎
6. The prescriptions drugs were Lipitor (10 mg), Viagra (100 mg), Celebrex (200 mg), Nexium (40 mg), and Zoloft (100 mg).   Go to ⤴︎
7. The samples were also cross-checked against a second lot from a separate national pharmacy chain store to verify consistency and determine method robustness. R. Bate, G. Jin, and A. Mathur, "In Whom We Trust: The Role of Certification Agencies in Online Drug Markets," NBER Working Paper 17955, July 2013, and Berkeley Express Journal of Economic Analysis & Policy, Contribution Tier, 14(1), 2013, pp. 111–50.   Go to ⤴︎
8. B. Skinner, "Canada's Drug Price Paradox: The Unexpected Losses Caused by Government Interference in Pharmaceutical Markets," Fraser Institute Digital Publication, 2005. https://www.fraserinstitute.org/sites/default/files/CanadasDrugPriceParadox.pdf.   Go to ⤴︎
9. According to C. Gurau, "Pharmaceutical Marketing on the Internet: Marketing Techniques and Customer Profile," Journal of Consumer Marketing, 22(7), 2005, pp. 421–8, the most frequent reasons quoted by interviewees for buying or intending to buy online were convenience and saving money, followed by information anonymity and choice. In our own survey (R. Bate, G. Jin, and A. Mathur, 2014) of 2,522 members of RxRights, 61.54 percent purchased drugs online, mostly from foreign websites, citing cost savings as the leading reason.   Go to ⤴︎
10. M. Chesnes, W. Dai, and G. Jin, "Banning Foreign Pharmacies from Sponsored Search: The Online Consumer Response," NBER Working Paper 20088, May 2014, and Marketing Science, 36(6),2017, pp. 879–907.   Go to ⤴︎
11. R. Bate, G. Jin, and A. Mathur, "Does Price Reveal Poor-Quality Drugs? Evidence from 17 Countries," NBER Working Paper 16854, March 2011, and Journal of Health Economics, 30(6), 2011, pp. 1150–63.   Go to ⤴︎
12. R. Bate, G. Jin, and A. Mathur, "Falsified or Substandard? Assessing Price and Non-Price Signals of Drug Quality," NBER Working Paper 18073, October 2012, and Journal of Economics & Management Strategy, 24(4), 2015, pp. 687–711.   Go to ⤴︎
13. Substandard and falsified drugs are not necessarily counterfeits. The World Health Organization in 2010 (http://www.who.int/en/news-room/fact-sheets/detail/substandard-and-falsified-medical-products) defined counterfeit drugs by the intent to deceive, but it is extremely difficult to prove intent in practice, especially if the focus is on the intent to infringe trademark rather than the intent to provide effective medicines. As a result, deliberating on trademark infringement often diverts attention from drug quality and its public health implications. By this definition, a counterfeit drug could have zero, some, or even full content of API, if it infringes the trademark; in the meantime, substandard or falsified drugs could be produced by manufacturers that have the legal trademark and other IP rights on the drug. Go to ⤴︎

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