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6:
o -- brand-name + -- generic
Number of generic entrants
Price per patient day
1
.5
0
10
5
0 5
10
15
20
6
4
2
0 0
5
10
15
20
Total no. of patient days sold (million)
0
Brand-generic sales ratio (qb/qg)
15
0
5
10
15
20
0
5
10
15
20
55
50
45
40
Time since patent expired (quarter)
! ;
6'
o Average of simulated data + Actual data
Price per patient day (1990 dollars)
Brand-name price
Generic price
.9
.3
.8 .2 .7 .1 .6
.5
0 0
5
10
15
20
0
Number of Patient Days (million)
Brand-name demand
5
10
15
20
10
15
20
Generic demand 40
40
30 30 20 20 10
10
0 0
5
10
15
20
0
5
Time since patent expired (quarter)
! 5; > ; +
69
o price-sensitive consumers + price-insensitive consumers
Number of Patient Days (million)
20
15
10
5
0 0
5 10 15 Time since the patent expired (quarter)
20
! 6; 2
Number of Patient Days (million)
20
15
10
5
0 0
5 10 15 Time since the patent expired (quarter)
! /; *
6.
20
Brand-name price per patient day (1990 dollars)
o -- type 0
+ -- type 1 x -- original model
1
.8
.6
.4
.2 0
5
10 15 Time since patent expired (quarter)
20
! :; 2
Proportion of brand-name sales accounted for by price-insensitive patients
1
.8
.6
.4 0
5
10 15 Time since patent expired (quarter)
20
! '; 1
6-
Price per patient day (1990 dollars)
o Original Model + Experiment: increase entry probability Brand-name price
Generic price
.9
.3
.8 .2 .7 .1 .6 .5
0 0
5
10
15
20
0
Number of Patient Days (million)
Brand-name demand
5
10
15
20
10
15
20
Generic demand
40
30
30
20
20
10
10
0 0
5
10
15
20
0
5
Time since patent expired (quarter)
! 9; ; +
/3
Expected return form submitting an application (million, 1990 dollars)
o Original Model
+ Experiment: increase entry probability
10
8
6
4
2
0 0
5 10 Number of firms applying for ANDA
15
! .; C #B"#
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15
10
5
0 0
5
10 15 Time since patent expired (quarter)
! -; # B
/
20
Average predicted perceived variance of generics
o Original Model
+ Experiment
0
5
40
30
20
10
0 10 15 Time since patent expired (quarter)
20
! 3; # ;
/5
o Average of simulated data + Actual data
Price per patient day (1990 dollars)
Brand-name price
Generic price
.9
.3
.8 .2 .7 .1 .6
.5
0 0
5
10
15
20
0
Number of Patient Days (million)
Brand-name demand
5
10
15
20
10
15
20
Generic demand 40
40
30 30 20 20 10
10
0 0
5
10
15
20
0
5
Time since patent expired (quarter)
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