ABSTRACT
This chapter examines whether mergers and acquisitions in the pharmaceutical industry in any way produce results mimicking those of monopoly or collusion. The result of the productive-efficiency view of mergers and acquisitions is to demonstrate that it is unlikely for mergers and acquisitions to produce a significant expansion of the merging firm's share of the market compared to their rivals. To establish, empirically, whether in the long run mergers and acquisitions in the pharmaceutical industry have increased the market power of the merging firms in relation to their non-merging, the overall difference in market share of the group of firms involved in mergers and acquisitions between 1989 and 1999 is examined, measured by value, vis-a-vis that of the group of their non-merging rivals. Each of these macroeconomic studies looked at the pharmaceutical industry in total, it is characterized by intense rivalry at the firm level allied with strong competitive pressure at the product level.
