Research

Publications 

Common Ownership and Market Entry: Evidence from the Pharmaceutical Industry
with A. Banal-Estanol and J. Seldeslachts Online Working paper version Media coverage: Bloomberg Businessweek,
Forthcoming in AEJ: Microeconomics 

Common ownership - where several firms are (partially) owned by the same investors - and its impact on product market competition has recently drawn much attention. This paper focuses on its implications for market entry. We consider the entry decisions of generic pharmaceutical firms into drug markets that are opened up by the end of regulatory protection and which were previously dominated by a single firm selling the brand name drug. We find robust evidence that an increase in common ownership leads to a significant reduction in generic entry.

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The Cost of Influence: How Gifts to Physicians Shape Prescriptions and Drug Costs
with M. Valente Online Media coverage:  Business Scholarship Podcast  
Winner of the NOeG Young Economists' Award 2023
Journal of Health Economics, Volume 95, May 2024 

This paper investigates the influence of gifts - monetary and in-kind payments - from drug firms to US physicians on prescription behavior and drug costs. Using causal models and machine learning, we estimate physicians' heterogeneous responses to payments on antidiabetic prescriptions. We find that payments lead to increased prescription of brand drugs, resulting in a cost rise of $23 per dollar value of transfer received. Paid physicians show higher responses when they treat higher proportions of patients receiving a government-funded low-income subsidy that lowers out-of-pocket drug costs. We estimate that introducing a national gift ban would reduce diabetes drug costs by 2%.

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Adverse Effects of Acquisitions in the Pharmaceutical Industry
with K. N. Vokinger Online  Nature Medicine 2022 

Publicly funded research leads to the development of many new drugs, but the profits are largely reaped by big pharmaceutical companies through exclusive licensing deals, mergers and acquisitions, which can reduce competition and patients’ access to medicines. Using chimeric antigen receptor-Tcell therapy (CAR-T) for the treatment of certain hematological malignancies as a case study, this article highlights the challenges of these acquisitions. 

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Common Ownership in the US Pharmaceutical Industry: A Network Analysis
with A. Banal-Estanol and J. Seldeslachts Online  in The Antitrust Bulletin 66, 1, Spring 2021.
Media coverage: TRT World 

We investigate patterns in common ownership networks between firms that are active in the US pharmaceutical industry for the period 2004-2014. Our main findings are that “brand firms”—ie firms that have R&D capabilities and launch new drugs—exhibit relatively dense common ownership networks with each other that further increase significantly in density over time, whereas the network of “generic firms”—ie firms that primarily specialize in developing and launching generic drugs—is much sparser and stays that way over the span of our sample. Finally, when considering the common ownership links between brands firms, on the one hand, and generic firms, on the other, we find that brand firms have become more connected to generic firms over time. We discuss the potential antitrust implications of these findings. 

Working papers

Do Expert Panelists Herd? Evidence from FDA Committees
with R. Midjord  Online 

We develop a structural model to address the question whether, and to what extent, expert panelists engage in herd behavior when voting on important policy questions. Our data comes from FDA advisory committees voting on questions concerning the approval of new drug applications. We utilize a change in the voting procedure from sequential to simultaneous voting to identify herding. Estimates suggest that around half of the panelists are willing to vote against their private assessment if votes from previous experts indicate otherwise and, on average, 9 percent of the sequential votes are actual herd-votes. Temporary committee members are more prone to herding than regular (standing) members. We find that simultaneous voting improves information aggregation given our estimates.

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Acquiring R&D Projects: Who, When, and What? Evidence from Antidiabetic Drug Development
with J. Malek, J. Seldeslachts and R. Veugelers Online

This paper analyzes M&A patterns in the antidiabetics industry along the innovation process. For this purpose, we  construct a database with all corporate R&D activities for individual antidiabetics projects over the period 1997 - 2017, and add highly detailed information on firms' technology dimension and their position in product markets. This allows us to identify the identity of targets and acquirers (who), the timing of acquisitions along the R&D process (when), and which type of R&D projects changes hands in terms of novelty (what).

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The Antitrust Case Against Apple
with B. Kotapati, S. Mutungi, J. Schroeder, S. Shao and M. Wang  Online 
Media coverage: The Information, Politico, No. 4 on the world’s most downloaded antitrust articles of 2020 

This article explores several potential antitrust claims against Apple - namely tying, essential facilities, refusal to deal and monopoly leveraging. We argue that the Apple ecosystem's large revenue share in terms of app transactions, lock-in effects and consumers' behavioral bias in online markets give the iPhone maker monopoly power as a mobile platform. Apple has exploited its market power to illegally tie the distribution of digital goods to its proprietary in-app purchase system to impose a 30% tax and extract supracompetitive profits, leading to higher app prices and reduced innovation. Moreover, Apple has excluded rivals and favored its own apps by downgrading competitors' discovery and promotions, blocking certain rivals entirely from the App Store, and limiting others' access to key APIs, in some cases right after copying their apps. These anticompetitive practices prolong and expand Apple's monopoly at the expense of competition.

Policy 

Do Private Equity and Other Investors Harm Competition in the Pharmaceutical Industry? Promarket, May 2025, Online  

Übernahmen in der Pharmaindustrie: Fokus mehr auf Innovationsmärkte als auf Marktverdrängung richten, DIW Wochenbericht 37 / 2024, September 2024, Online  with J. Malek, J. Seldeslachts and R. Veugelers 

Es braucht innovative Regulierungen (in German), CSS Im Dialog, February 2024. Online  

Evaluation of Climate Policy Based on Machine Learning: The Case of Switzerland, Policy report for the Swiss Federal Office for the Environment, 2023, with V. Cruz and L. Bretschger

'Killer acquisitions' en innovatie (in Dutch) with J. Malek and J. Seldeslachts, KVS Preadviezen 2020,  Online

US and EU secure vaccine production on home soil with J. Malek, J. Seldeslachts and M. Wieting, DIW Focus No. 6, 10/2020,  Online

Changes in Common Ownership of German Companies with J. Seldeslachts and A. Banal-Estanol, DIW Economic Bulletin 30/2017, Online, Media coverage: Mail & Guardian 

Work in progress

Greening the Deal: Do acquisitions boost or block environmental transformation? with D. Jaggi and J. Posth

Voting in Advisory Committees with  R. Midjord and A. Guarino