Análisis del mercado de medicamentos en Colombia

This document presents an analysis of the effect of horizontal mergers in the colombian pharmaceutical market among Sanofi, Genfar, Pfizer and Wyeth laboratories, over price and quantities sold. Using data from the Ministerio de Salud y Protección Social, the DIAN and the Sistema de Información y Riesgo Empresarial de la Superintendencia de Sociedades (SIREM), indexes were calculated for the variables weighted average price, total assets, cash flow, total liabilites, total equity, exports, imports and market share. In addition, a diff-in-diff model was specified to see the effect of mergers in certain variables of interest. The main results show that the pharmaceutical market is highly competitive and for this reason there are incentives to merge. Additionally, it was found that the market share of the laboratories was reduced after integration. This contradicts the theory of horizontal mergers, because they are not only done to get more market power or increase market share, but to strengthen the merged companies.