Date and Time
April 14, 2010
1:30 PM - 3:00 PM

Availability
Open to the public
No RSVP required

Speaker
Jay Bhattacharya - Stanford University

This presentation examines whether the composition of medical research responds to changes in disease incidence and research opportunities. The paper also provides new evidence on induced pharmaceutical innovation. In both cases we use the change in the demographic structure of the market (measured by age structure and obesity prevalence) to test the induced innovation hypothesis. Technological opportunity is calculated from estimates of structural productivity parameters. The extent of inventive activity is measured from the MEDLINE database on 16 million biomedical publications. We match these data with data on disease incidence. We show that medical research responds to changes in disease incidence and research opportunities. We compare our findings on academic medicine, which largely (though not exclusively) reflects non-profit allocation, with the findings in the related literature, which has focused on allocations that are mainly (though not exclusively) the result of for-profit allocation. We also find that pharmaceutical innovation responds to aging- and obesity-induced changes in potential market size.