Agency relationship

What distinguishes the pharmaceutical market and justifies the need to fix maximum limits to public financing such as those involved in RP systems The pharmaceutical sector differs from other sectors in veiy important respects,14 15 including an imperfect agency relationship, imperfect informa -tion, moral hazard and joint, sunk and fixed costs. 

The consumer does not usually have to pay the whole of the price of the drag prescribed by the doctor. Even in the case of a perfect agency relationship between prescriber and patient, drag consumption may not be optimal because of the existence of moral hazard. This means that the insured patient has no incentive to induce the doctor to make the effort to seek information on lower-cost treatments. Even if the doctor had complete information, because of moral hazard the patient would tend not to demand the socially optimal quantity of prescribed drags. Consequently, the patient may receive an excess of prescriptions and/or the drags prescribed may be too expensive in relation to the social optimum.17... 

To sum up, the factors that enable the supply side to fix prices above the marginal cost are (a) the imperfect agency relationship between the doctor (the agent) and the insurer (the principal) the prescriber may prefer the brand product, about which he or she has acquired knowledge and experience during the patent period (risk aversion), (b) the patient, and sometimes also the doctor, may have imperfect information on the quality of cheaper alternatives, and (c) the lack of incentives to change prescription habits (moral hazard). 

In the above sections we have supposed that pharmaceuticals are conventional goods and that their market shows no essential differences from any other normal market. The effects of co-payment that we have studied will occur if a number of conditions are fulfilled, including the condition that the rational and perfectly informed consumer is an independent generator of demand. The phenomenon of induced demand and incomplete agency relationships, together with uncertainty as to the effectiveness of alternative treatments and doses, can cloud these theoretical results. In this section we analyse to what extent the pharmaceutical market fulfils or fails to fulfil these conditions. 

Who are the customers of the pharmacy service Patients, their relatives, physicians, nurses, society, managers and administrators, politicians, students, and so on are the customers. They do not always share the same values and can even have conflicting interests. This is due to agency relationships, so frequent in healthcare. 

Fudenberg, D., Holmstrom, B. and Milgrom, P. 1990, Short-Term Contracts and Long-Term Agency Relationships. Journal of Economic Theory 51, 1-31. 

Bergen, M., Dutta, S., Walker, O. C., Jr. (1992). Agency relationships in marketing A review of the implications and applications of agency and related theories. Journal of Marketing, 56(July), 1-24. 

The principal benefit of the causality based approach is that it avoids the automatic rejection of direct State responsibility merely because of the absence of an agency relationship. As a result, it potentially exposes the wrongdoing State to a greater range and intensity of remedies, as well as a higher degree of international attention and opprobrium for its contribution to the private terrorist activity. ... 

To foster a close relationship with the chemical, petroleum, gas, and energy industries and governmental agencies for the exchange of information and knowledge and to ensure that research results and discoveries of significance will be effectively exploited... 

Chart showing hierarchical relationship among a technique, methods using that technique, and procedures and protocols for one method. (Abbreviations APHA = American Public Health Association, ASTM = American Society for Testing Materials, EPA = Environmental Protection Agency)... 

M. C. Dodge, Combined Use of Modeling Techniques and Smog Chamber Data to Derive O ne-Precursor Relationships,Repott No. EPA-600/3-77-001a, U.S. Environmental Protection Agency, Research Triangle Park, N.C., 1977. 

Since an air pollution control agency must maintain its extramural relationships, the following functions must be provided ... 

World Health Organization (The United Nations Agency that deals with the Relationship between Human Health and Pollution)... 

The audit also emphasizes the self-regulated nature of the industry and the ideal relationship between the agency and the industry. In theory and effective practice, a biomedical company utilizes its quality assurance (QA) unit (in this case, supplemented by credible Part 11 auditors) to maintain control of safety, effectiveness, and quality. The FDA can then review the quality system (QS) and spot-check the other systems such as laboratory or production for most efficient regulatory oversight. In effect, the QA regulates the company and the FDA regulates the QA. 

Based on its recent experience in facilitating the deployment of explosives-detection equipment at airports around the country, DHS s Transportation Security Administration (TSA) has established relationships with local airport authorities and is the agency most knowledgeable about U.S. 

EPA. 1976. Effect of hydrogen sulfide on fish and invertebrates, Part II—Hydrogen sulfide determination and relationship between pH and sulfide toxicity. Report to the U.S. Environmental Protection Agency, Environmental Research Lab, Duluth, MN, by Broderius SJ, Smith LL Jr., University of Minnesota, Department of Entomology, Fisheries, and Wildlife, St. Paul, MN. 

In a study by Andersson et al. [30], the possibilities to use quantitative structure-activity relationship (QSAR) models to predict physical chemical and ecotoxico-logical properties of approximately 200 different plastic additives have been assessed. Physical chemical properties were predicted with the U.S. Environmental Protection Agency Estimation Program Interface (EPI) Suite, Version 3.20. Aquatic ecotoxicity data were calculated by QSAR models in the Toxicity Estimation Software Tool (T.E.S.T.), version 3.3, from U.S. Environmental Protection Agency, as described by Rahmberg et al. [31]. To evaluate the applicability of the QSAR-based characterization factors, they were compared to experiment-based characterization factors for the same substances taken from the USEtox organics database [32], This was done for 39 plastic additives for which experiment-based characterization factors were already available. 

United States Environmental Protection Agency (2011) Methodology document for the ecological Structure-Activity Relationship Model (ECOSAR) Class Program MS-Windows Version 1.1 Office of Pollution Prevention and Toxics, Washington, DC. http //www.epa.gov/ oppt/newchems/tools/ecosartechfinal.pdf. Accessed 09 Mar 2012... 

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