Conflicting trends confound the pharmaceutical industry. The productivity of pharmaceutical innovation has declined in recent years. At the same time, the cohort of large companies who are the leading engines of pharmaceutical R&D has become increasingly concentrated. The concurrent presence of...

In recent years, antitrust officials have recognized that vertical arrangements can cause competitive harm through two routes: first, they can facilitate collusion among rivals, and second, they can raise rivals’ costs and thereby create barriers to entry or expansion. In this paper, we...