Payers often assess the benefits of new drugs relative to costs for reimbursement purposes, but they frequently exclude some drugs' option-related benefits, reducing their reimbursement chances, and making them less attractive R&D investments. We develop and test a real options model of R&D...

In this article we describe how reimbursement cost-effectiveness thresholds, per unit of health benefit, whether set explicitly or observed implicitly via historical reimbursement decisions, serve as a signal to firms about the commercial viability of their R&D projects (including candidate...

As health care reform evolves and takes shape, comparative effectiveness research appears to be one of the central topics on the national health care agenda. Over the past couple of years, comparative effectiveness has been explicitly incorporated in over ten bills. For example, the passage of...

This paper models how the evolving field of pharmacogenomics (PG), which is the science of using genomic markers to predict drug response, may impact drug development times, attrition rates, costs, and the future returns to research and development (R&D). While there still remains an abundance...

Drug innovation relies on cumulative, path-dependent, incremental research and development (R&D). In oncology, path-dependence may not be along a single dimension, such as steadily improving efficacy or survival against a given endpoint in the same population, but innovation builds on itself....

This paper models how the evolving field of pharmacogenomics (PG), which is the science of using genomic markers to predict drug response, may impact drug development times, attrition rates, costs, and the future returns to research and development (R&D). While there still remains an abundance...