Title: Volatility of the pharmaceutical market in China and the USA

Authors: Stuart O. Schweitzer, Yingyao Chen, Sepideh S. Farivar, Jun Lu

Addresses: UCLA School of Public Health, Los Angeles, CA, USA. ' School of Public Health, Fudan University, Shanghai, China. ' UCLA School of Public Health, Los Angeles, CA, USA. ' School of Public Health, Fudan University, Shanghai, China

Abstract: This study measures the rate at which pharmaceuticals change their sales rankings from one year to another, the market volatility. Volatility is a useful way of describing the pharmaceutical market, and is a reflection of the rate of technological change, aggressive marketing efforts, and market concentration. Volatility is assessed for top-selling pharmaceuticals in the USA and Shanghai, China between 1997 and 2001. Volatility was substantial in both countries, averaging nearly 0.20 for year-to-year comparisons. Over the four year period volatility was nearly 0.5. Volatility tended to be higher in China than in the USA. The rapid change in sales rankings of drugs means that drug knowledge rapidly becomes obsolete and improved drug education is needed for physicians, insurers, pharmacists and patients.

Keywords: innovation; pharmaceuticals; competition; pharmaceutical market; volatility; sales rankings; China; USA; United States.

DOI: 10.1504/IJHTM.2006.010415

International Journal of Healthcare Technology and Management, 2006 Vol.7 No.6, pp.541 - 553

Published online: 20 Jul 2006 *

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