On reimbursement reforms and stockpiling of prescription drugs: The case of insulin

ObjectivesTo show that care should be taken in studies which aim at linking prescription drug prices to purchased quantities due to anticipation and stockpiling effects.MethodsUsing purchasing records for a 20% random sample of the entire Danish population, the effects of increasing co-payments are estimated using fixed effects techniques.ResultsThe results indicate that insulin-takers react to announced changes in reimbursement policies by stockpiling on their medications.ConclusionUsing before-and-after comparisons to identify the price responsiveness of prescription drug demand can be very misleading, when changes in co-payments are announced.