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Abstract

This thesis examines the delicate balance of satisfying the needs of both producers and consumers of prescription pharmaceutical drugs. An analysis of the factors which influence a drug’s lifetime revenue is performed through executing an Ordinary Least-Squares linear regression. In addition, the cumulative lifetime revenues of the drugs were manipulated to determine the effects of reducing the length of a pharmaceutical patent to simulate a shorter period of exclusivity and an accelerated time of possible entry for generics into the market. The results of these experiments find that market size, defined as the prevalence of the disease the medication treats in the US, and years active on the market possess the strongest association with lifetime cumulative revenue, while the type of illness being treated, either chronic or acute, has a positive but weak association. The expected revenues of the drugs with patent lives reduced to 10 and 15 years suggest that the changes would be too extreme for producers at the 10 year patent life but beneficial to both sides at the 15 year patent life.

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