Strategic Submissions: A Cross-Country Analysis of Supplemental Drug Approvals

Résumé

Off-label use regulation has the potential to change pharmaceutical rms' behavior and|consequently|affect patient welfare. We investigate the impact of two changes in off-label regulation on pharmaceutical rms' behavior in seeking formal market- ing approval for supplementary uses. In 2012, a US court decision protected truthful o-label promotion, providing pharmaceutical companies more leeway to promote o- label uses of their drug. Similarly, in 2011, France passed a new system for monitoring o-label uses in anticipation of formal approval. Using a unique data set of pharma- ceutical rms' research and development projects, we exploit these regulatory changes to understand how rms react to government policies. Results demonstrate that rms responded to the US policy providing lower incentives to submit supplemental uses for formal approval. The results do not evince any reaction to France's stringent|but poorly enforced|regulation. These results have implications not only for innovation policy but for the creation of high-quality data for certain indications.