• Sessions
• Presentations
• Posters
• Rooms

Presentation

Session: Drug Regulation
Room: Elissa Hall
Time: Fri 08:30-09:45

Presenter: Stefan Felder (University of Duisburg-Essen. Faculty of Economics and Business Administration)

Abstract

Drugs must be authorized by a relevant regulatory body in order for physicians to be able to prescribe them. The marketing authorization is granted if the drug is judged to be safe and effective for a given population or indication. This is the drug ‘label’. When the drug is used for other indications, it is used ‘off label’. Off-label prescribing is very common in all areas of medicine. In oncology, the off-label use of drugs has been estimated to reach 50% or even more. In pediatrics, the off-label issue is particularly widespread, all the more in pediatric oncology. Often, however, the effects of off-label drug use on patients’ health are uncertain. Off-label drug use for children is considered particularly risky.

The extensive and risky off-label use of drugs led governments to adjust patent and exclusivity regulations. With the FDA Modernization Act of 1997, the US - followed by the European Union in 2006 - introduced a reward for pharmaceutical manufacturers if they strive for extended approval of off-label drugs in pediatrics. A six-month prolongation of patent protection or exclusivity is granted for an investment in pediatric clinical tests. As manufacturers trade off the costs of pediatric testing and the expected additional sales, the extension of an exclusive marketing right can be decisive for their investment choice.

This paper investigates the implication of patent prolongation regarding static and dynamic efficiency of off- vs. label use of drugs and studies physician liability as an alternative measure for addressing the off-label use of drugs. It shows that a reinforcement of physician liability for off-label use may be the preferred instrument for achieving dynamic efficiency. The liability threat reduces the demand for off-label use, giving manufacturers an appropriate incentive to invest in extended approval. By contrast, patent prolongation does not affect physicians’ prescription decisions and increases the likelihood of investments in cases where induced benefits fall short of testing costs.

Key Terms

off-label use, patent protection, exclusivity, liability

Authors:

Stefan Felder (University of Duisburg-Essen. Faculty of Economics and Business Administration)

Search with Google