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Regulating the Dutch pharmaceutical market: improving efficiency or controlling costs?
Author(s) -
de Wolf Peter,
Brouwer Werner B. F.,
Rutten Frans F. H.
Publication year - 2005
Publication title -
the international journal of health planning and management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.672
H-Index - 41
eISSN - 1099-1751
pISSN - 0749-6753
DOI - 10.1002/hpm.819
Subject(s) - incentive , government (linguistics) , business , competition (biology) , public economics , health care , medical prescription , industrial organization , pharmaceutical industry , market share , economics , marketing , market economy , economic growth , medicine , pharmacology , ecology , linguistics , philosophy , biology
In this paper, we describe the Dutch pharmaceutical market, which is heavily regulated by the government. Through the regulation of prices and promoting prudent use, the Dutch government tries to bring down the cost of pharmaceuticals, which increases every year at a higher rate than total health care expenditure. The complex system of regulation, especially aimed at cost containment, is not very effective, particularly with respect to controlling outpatient pharmaceutical expenditure. Moreover, the system has few incentives towards efficiency. Though the market share of generic pharmaceuticals is rapidly growing, pharmaceutical expenditure has not decreased accordingly. The discounts offered by wholesalers of generic products to pharmacists produce private rather than societal gains from generic prescriptions. Dismantling the current regulatory system, boosting competition and efficiency with insurers in a leading role, seems to be the way forward. Copyright © 2005 John Wiley & Sons, Ltd.