Shannon Rodel | May 31, 2018
Amid intense pressure to lower drug prices, policymakers in the pharmaceutical industry have leveraged regulations to increase product competition and lower prices by creating an expedited approval process for generic drugs.
But new research from the University of Notre Dame, Indiana University and the University of Minnesota shows such competition-inducing regulations may encourage companies to relax quality standards during the manufacturing process, which may put more patients at serious health risk due to lower-quality products and more product recalls. It also suggests generic drug makers may be underreporting discretionary recalls due to competitive pressures.
“Product competition, managerial discretion and manufacturing recalls in the U.S. pharmaceutical industry” is forthcoming in the Journal of Operations Management from Kaitlin Wowak, assistant professor of information technology, analytics and operations at Notre Dame’s Mendoza College of Business, along with George Ball from Indiana University’s Kelley School of Business and Rachna Shah from the University of Minnesota’s Carlson School of Management.
Read more here.