Research into free trade, care quality and the price of medicines

Press release

Three new research projects can now begin as the result of a funding decision by the Swedish Competition Authority. The projects focus on the quality of Swedish elderly care, the pricing of medicines and the point of intersection between competition law, intellectual property rights and free trade.

The three projects have been granted a combined total of just over SEK 1.2 million. In addition, six research projects already under way have been granted further financing totalling more than SEK 3.9 million.
Elderly care and cleaning services

What is the best way to provide public services? This is the subject of a research study by Sofia Lundberg of Umeå University. The study is entitled Competition, Quality and Favourisation in Public Service Provision. Via three empirical subprojects, Sofia Lundren will examine how such services can be provided in such a way as to improve efficiency and thereby enhance social welfare.

“The focus areas are elderly care and cleaning services, and how different types of exposure to competition (traditional procurement and customer choice models) impact both on quality and on favoritism in public service provision.”

“This project focuses on two priority areas of special interest to the Competition Authority – procurement and the health sector,” says Josefin Nilsson, secretary of the Council for Competition Research and the reporting officer at the Competition Authority. “I expect the findings to be of considerable interest.”

Pricing of substitutable medicines

Johan Stennek of Gothenburg University has been granted funding for a project entitled Does Reference Pricing and Mandatory Substitution Reduce Medical Costs?

He will be studying the exchange of prescribed medicines for generic ones (other preparations of a similar type) from two aspects: how such exchanges are affected by reference pricing and the mandatory substitution of medicines, and how price competition in the pharmaceutical market is affected by such substitutions. The latter study will take the form of a theoretical analysis.

The project also includes a field study to determine what kind of information pharmacy staff should provide so as to encourage customers to switch to generic medicines.

“This project concerns a highly topical subject, particularly bearing in mind the current reform of the pharmacy market,” says Josefin Nilsson.
Intellectual property rights, competition law and free mobility
Hans Henrik Lidgard of Lund University will be researching issues that arise at the point of intersection between intellectual property rights, competition law and the free movement of goods. His project is entitled IPR, Competition and Free Movement of Goods.

In the light of legislative developments both in the EU and in the US, he will be examining the question of how this borderland should be dealt with in legal terms. The study approach is to be legally dogmatic with a comparative orientation, and the conclusions will be tested by means of legal-economic methodology.

“The point at which intellectual property rights and competition law meet is an exciting area of study,” says Josefin Nilsson. “The project findings could make a significant contribution to jurisprudential doctrine in this field.”

The Riksdag (Swedish Parliament) has allocated funding that the Competition Authority distributes annually, in collaboration with the Council for Competition Research, to research projects of particular interest from a competition or procurement viewpoint.

For further information, please contact:
Josefin Nilsson, Case Officer, Competition Law Dept, tel +46 8-700 16 66 or +46 73-773 16 66
Jimmy Dominius, Press Officer, tel +46 8 700 15 80 or +46 73 773 15 80.

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