Not available in 2022/23
HP4E5E      Half Unit
Economics of the Pharmaceutical Sector

This information is for the 2022/23 session.

Teacher responsible

Dr Panagiotis Kanavos COW 1.05


This course is compulsory on the Executive MSc in Health Economics and Policy (LSE and Chicago). This course is not available as an outside option.

Course content

The aim of this course it to introduce students to the economics of pharmaceutical markets and related policies at national, supranational, and global level. The course will illustrate to students how pharmaceutical markets are linked to the health care market and the associated imperfections and market failures and how these manifest themselves at national, supranational, and global level. The course will provide students with an understanding of basic features of pharmaceutical markets (intellectual property, licensing, pricing regulation, policies on reimbursement) and an understanding of how pharmaceutical markets work, how competition manifests itself in different market segments (in-patent vs off-patent). The course will introduce students to the economics of pricing and reimbursing pharmaceutical products and will explore different pricing and reimbursement models for medicines in OECD countries, including rate of return regulation, value-based pricing, cost-plus pricing, external price referencing and internal reference pricing. Finally, the course will explore key aspects of the global health agenda related to pharmaceuticals and, specifically, access to medicines in resource-challenged settings, R&D models with emphasis on R&D in neglected diseases, vaccine procurement, and strategic procurement of medicines.


Given the executive nature of this course, it will be offered as an intensive, accelerated, and

compressed module within a 1-week duration. The course will be delivered as 12 hours of lectures

and 10 hours of seminars.

Formative coursework

The formative assessment will be a 800 word outline of the summative assessment essay question. The formative assessment will be a more detailed written outline of their essays written individually. Students will receive detailed individual feedback on their formative assessments and continue developing their assessed essays individually. The formative feedback is intended to help the students while developing their final essays.

Indicative reading

• P Kanavos, Impact and Costs of Pharmaceuticals and Biotechnology; in R.M.Scheffler (ed). Handbook of Global Health Economics and Public Policy, World Scientific, pp. 107-188; 2016.

• P Kanavos , Measuring performance in off-patent drug markets: A methodological framework and empirical evidence from 12 EU Member States. Health Policy, 118(2); 229-241, 2104.

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

• S O Schweitzer, Pharmaceutical Economics and Policy, Oxford University Press (2006);

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

• 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.


Essay (80%, 2500 words) and continuous assessment (20%) in the ST.

Key facts

Department: Health Policy

Total students 2021/22: Unavailable

Average class size 2021/22: Unavailable

Controlled access 2021/22: No

Value: Half Unit

Guidelines for interpreting course guide information

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.

Personal development skills

  • Leadership
  • Self-management
  • Team working
  • Problem solving
  • Application of information skills
  • Communication
  • Application of numeracy skills
  • Commercial awareness
  • Specialist skills