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VOLUME 54 | NUMBER 4 | AUGUST 2019


Will converting naloxone to overthecounter status increase pharmacy sales?

Objective: To estimate the ownprice elasticity of demand for naloxone, a prescription medication that can counter the effects of an opioid overdose, and predict the change in pharmacy sales following a conversion to overthecounter status.

Data Sources/Study Setting: The primary data source was a nationwide prescription claims dataset for 20102017. The data cover 80 percent of US retail pharmacies and account for roughly 90 percent of prescriptions filled. Additional covariates were obtained from various secondary data sources.

Study Design: We estimated a longitudinal, simultaneous equation model of naloxone supply and demand. Our primary variables of interest were the quantity of naloxone sold, measured as total milligrams sold at pharmacies, and the outofpocket price paid per milligram, both measured per ZIP Code and quarteryear.

Data Collection/Extraction Methods: Primary data came directly from payers and processors of prescription drug claims.

Principal Findings: We found that, on average, a 1 percent increase in the outofpocket price paid for naloxone would result in a 0.27 percent decrease in pharmacy sales. We predict that the total quantity of naloxone sold in pharmacies would increase 15 percent to 179 percent following conversion to overthecounter status.

Conclusions: Naloxone is ownprice inelastic, and conversion to overthecounter status is likely to lead to a substantial increase in total pharmacy sales.

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