Market failure in the pharmaceutical industry and how it can be overcome: The CureShare mechanism

Moshe Levy, Adi Rizansky

Research output: Contribution to journalArticlepeer-review

Abstract

Allowing patients to take part in the initial investment for the development of cures for their illnesses can, under certain conditions, lead to the development of drugs that would have otherwise not been developed and to a dramatic welfare increase. We theoretically analyze these conditions. The suggested patient investment mechanism, which we call CureShare, does not involve any philanthropy or government subsidies. It is simply a way to overcome market failure. Based on empirical data, we estimate that applying this mechanism may save thousands of lives annually and may dramatically improve the quality of many others.

Original languageAmerican English
Pages (from-to)143-156
Number of pages14
JournalEuropean Journal of Health Economics
Volume15
Issue number2
DOIs
StatePublished - Mar 2014

Keywords

  • Innovation
  • Market failure
  • Pharmaceutical industry
  • Utility of health

All Science Journal Classification (ASJC) codes

  • Economics, Econometrics and Finance (miscellaneous)
  • Health Policy

Fingerprint

Dive into the research topics of 'Market failure in the pharmaceutical industry and how it can be overcome: The CureShare mechanism'. Together they form a unique fingerprint.

Cite this