Price Effects of Pharmaceutical Mergers in Highly Regulated Markets

Abstract

Over recent decades, mergers and acquisitions (M&A) have become a defining feature of the global pharmaceutical industry, influencing competitive dynamics, cost structures and ultimately pricing outcomes. Yet the pricing implications of concentration in highly regulated markets remain far from settled. This study examines the pricing impact of pharmaceutical mergers and acquisitions in Sweden using a staggered difference-in-differencesframework. The analysis draws on panel data covering more than 1.2 million observations. In contrast to much of the existing international evidence, the results suggest a post-mergerprice decline, rather than the commonly documented increase. Inthe Swedish pharmaceutical market, post-merger pricing patterns are suggestive of cost-side synergiesand scale efficiencies, potentially offsetting concentration-driven pricing pressure.