Retail pharmacies and drug diversion during the opioid epidemic

• Main Authors: JANSSEN, Aljoscha, ZHANG, Xuan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2023
• Subjects: pharmacy; ownership; prescription opioids; drug diversion; Chemicals and Drugs; Health Economics; Industrial Organization
• Online Access: https://ink.library.smu.edu.sg/soe_research/2670; https://ink.library.smu.edu.sg/context/soe_research/article/3669/viewcontent/Opioids_RR2.pdf
• Institution: Singapore Management University

This study investigates the role of retail pharmacy ownership in the opioid epidemic. Using data of prescription opioid orders, we show that compared with chain pharmacies, independent pharmacies dispense 39.1% more opioids and 60.5% more OxyContin. After an independent pharmacy becomes a chain pharmacy, opioid dispensing decreases. Using the OxyContin reformulation, which reduced non-medical demand but not the legitimate medical demand, we show that at least a third of the difference in the amount of OxyContin dispensed can be attributed to non-medical demand. We show that differences in competitive pressure and whether pharmacists own the pharmacy drive our estimates.