HP424      Half Unit
Pharmaceutical Economics and Policy

This information is for the 2021/22 session.

Teacher responsible

Dr Olivier Wouters


This course is available on the MSc in Global Health Policy, MSc in Health Policy, Planning and Financing, MSc in International Health Policy and MSc in International Health Policy (Health Economics). This course is available as an outside option to students on other programmes where regulations permit.

Course content

The aim of this course is to introduce students to the economics of pharmaceutical markets and related policies that affect national and international markets broadly. The course will

- Provide students with an understanding of basic features of pharmaceutical markets, how pharmaceutical markets work and how competition manifests itself in different parts of pharmaceutical markets.

- Illustrate to students how the pharmaceutical market is linked to the health care market, why it is often the focus of much regulation, and to help students understand the multidimensional goals of pharmaceutical policies.

- Introduce students to the economic and policy problems encountered in managing pharmaceutical markets and how to evaluate the impact of alternative policy approaches. The course will also give students some experience in critically evaluating the impact of policy on market outcomes.

- Facilitate consideration of various country-specific political, cultural and economic factors that may drive governments' approaches to pharmaceutical regulation. In this context, this course will help students consider the extent to which policies may be transferable.

- Enable students to analyse pharmaceutical markets from the perspectives of several main actors: governments, third party payers, the pharmaceutical industry, doctors, patients, pharmacists and wholesalers. Literature from Health Economics, Industrial Organisation and Health Policy will be incorporated into lectures, discussions and seminars.

- Introduce students to the economics of pricing and reimbursing pharmaceutical products, to explore different models of pricing and reimbursing medicines in OECD countries, including rate of return regulation, value-based pricing, cost-plus pricing, external price referencing and internal reference pricing, among others.


This course will be delivered through a combination of lectures and seminars totalling a minimum of 24 hours during Lent Term. 

There will be a departmental reading week in week 6 of term.

Formative coursework

A formative essay under exam conditions (1 question in 1 hour) will be a requirement and is to be submitted immediately after the revision session.

Indicative reading

1. E Mossialos, M Mrazek & T Walley (eds), Regulating Pharmaceuticals in Europe. Striving for Efficiency, Equity and Quality, Buckingham, Open University Press (2004)

2. S O Schweitzer, Pharmaceutical Economics and Policy, Oxford University Press (2006)

3. W S Comanor, 'The Political Economy of the Pharmaceutical Industry', Journal of Economic Literature, XXIV (September): 1178-1217 (1986)

4. F M Scherer 'The Pharmaceutical Industry', Chapter 25, in: A J Culyer & J P Newhouse (Eds), Handbook of Health Economics, Vol 1, Amsterdam, Oxford, Elsevier, 2000.

1. A Acosta, A Ciapponi, Aaserud M, et al (2014). Pharmaceutical policies: effects of reference pricing, other pricing, and purchasing policies. Cochrane Database of Systematic Reviews, 10: CD005979.

2. AS Kesselheim, J Avorn, A Sarpatwari (2016). The high cost of prescription drugs in the United States: origins and prospects for reform. JAMA, 316(8): 858-871.

3. DH Howard, PB Bach, ER Berndt, RM Conti. Pricing in the market for anticancer drugs, 29(1): 139-162.

4. E Mossialos, M Mrazek & T Walley (eds) (2004). Regulating pharmaceuticals in Europe. Striving for efficiency, equity and quality. Open University Press.

5. OJ Wouters, M McKee, J Luyten (2021). Estimated research and development investment needed to bring a new medicine to market, 2009-2018. JAMA, 323(9): 844-853.


Exam (100%, duration: 2 hours) in the summer exam period.

Course selection videos

Some departments have produced short videos to introduce their courses. Please refer to the course selection videos index page for further information.

Student performance results

(2017/18 - 2019/20 combined)

Classification % of students
Distinction 10.2
Merit 69.3
Pass 19.7
Fail 0.8

Important information in response to COVID-19

Please note that during 2021/22 academic year some variation to teaching and learning activities may be required to respond to changes in public health advice and/or to account for the differing needs of students in attendance on campus and those who might be studying online. For example, this may involve changes to the mode of teaching delivery and/or the format or weighting of assessments. Changes will only be made if required and students will be notified about any changes to teaching or assessment plans at the earliest opportunity.

Key facts

Department: Health Policy

Total students 2020/21: 115

Average class size 2020/21: 14

Controlled access 2020/21: Yes

Value: Half Unit

Guidelines for interpreting course guide information