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Bates White authors publish in RAND Journal of Economics

August 18, 2017

Two Bates White authors have published articles in the fall 2017 issue of the RAND Journal of Economics that examine healthcare mergers.

Principal Minjae Song, along with co-authors Sean Nicholson of Cornell University and Claudio Lucarelli of the Universidad de los Andes in Colombia, published “Mergers with Interfirm Bundling: A Case of Pharmaceutical Cocktails.” Pharmaceutical cocktails often consist of two or more drugs produced by competing firms. The component drugs are often also sold as stand-alone products. This article analyzes the effects of a hypothetical merger between two pharmaceutical firms selling complements for colorectal cancer treatment. Read about the effects of the merger here.

Senior Economist Kevin Pflum and co-author Matthew S. Lewis of Clemson University published “Hospital Systems and Bargaining Power: Evidence from Out-of-Market Acquisitions” in the same issue of the journal. Analyses of hospital mergers typically focus on acquisitions that alter local market concentration. However, as hospital systems and insurers negotiate prices, this focus may overlook the impact of cross-market interdependence in the bargaining outcome. Using data on out-of-market acquisitions that occurred across the United States from 2000 to 2010, this article investigates the impact of cross-market dependencies on negotiated prices. Read the findings here.