Drug companies more likely to keep R&D in-house when patents are at stake

Drug companies are more likely to keep research and development (R&D) in-house, rather than outsource it, when they already have patented drugs on the market in the same therapeutic area, and especially when those patents still have years of protection left, according to a new study co-authored by Lucy Xiaolu Wang, assistant professor in the Department of Resource Economics. The reason: To avoid what economists call "cannibalization," or competing with themselves.