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Deregulating the Finnish OTC-drug market- a cost-benefit analysis

Lahtinen, Emmi-Lie LU (2022) NEKP01 20212
Department of Economics
Abstract (Swedish)
This study is an ex-ante cost-benefit analysis of a deregulation of OTC-drugs in Finland allowing over-the-counter pharmaceuticals to be sold outside pharmacies. It assumes a segmented market with differing consumer preferences over pharmacy and non-pharmacy services when purchasing OTC-pharmaceuticals.
The results suggest that consumers have a lot to gain by the deregulation through a new lower-price service when buying the OTC-pharmaceuticals. Producer surplus varies between positive and negative in sensitivity analyses, but the net social benefit is positive. There is a risk of worse availability of both prescription and over-the-counter pharmaceuticals through pharmacy market exits. This study did not quantify the risks of medicines... (More)
This study is an ex-ante cost-benefit analysis of a deregulation of OTC-drugs in Finland allowing over-the-counter pharmaceuticals to be sold outside pharmacies. It assumes a segmented market with differing consumer preferences over pharmacy and non-pharmacy services when purchasing OTC-pharmaceuticals.
The results suggest that consumers have a lot to gain by the deregulation through a new lower-price service when buying the OTC-pharmaceuticals. Producer surplus varies between positive and negative in sensitivity analyses, but the net social benefit is positive. There is a risk of worse availability of both prescription and over-the-counter pharmaceuticals through pharmacy market exits. This study did not quantify the risks of medicines misuse or risks to consumer safety and health. Further research is needed before drawing conclusions of the overall welfare effects. (Less)
Please use this url to cite or link to this publication:
author
Lahtinen, Emmi-Lie LU
supervisor
organization
course
NEKP01 20212
year
type
H2 - Master's Degree (Two Years)
subject
keywords
cost-benefit analysis, Finland, deregulation, pharmacy market, over-the-counter drugs
language
English
id
9074706
date added to LUP
2022-02-22 11:18:25
date last changed
2022-02-22 11:18:25
@misc{9074706,
  abstract     = {{This study is an ex-ante cost-benefit analysis of a deregulation of OTC-drugs in Finland allowing over-the-counter pharmaceuticals to be sold outside pharmacies. It assumes a segmented market with differing consumer preferences over pharmacy and non-pharmacy services when purchasing OTC-pharmaceuticals.
The results suggest that consumers have a lot to gain by the deregulation through a new lower-price service when buying the OTC-pharmaceuticals. Producer surplus varies between positive and negative in sensitivity analyses, but the net social benefit is positive. There is a risk of worse availability of both prescription and over-the-counter pharmaceuticals through pharmacy market exits. This study did not quantify the risks of medicines misuse or risks to consumer safety and health. Further research is needed before drawing conclusions of the overall welfare effects.}},
  author       = {{Lahtinen, Emmi-Lie}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Deregulating the Finnish OTC-drug market- a cost-benefit analysis}},
  year         = {{2022}},
}