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Government Regulation of Pricing in the Pharmaceutical Market in the Retail Pharmacy Sector of Russia

Student: Antipova Maria

Supervisor: Liudmila S. Zasimova

Faculty: Faculty of Economic Sciences

Educational Programme: Economics (Bachelor)

Year of Graduation: 2018

This paper examines two methods of the government price regulation of the Russian pharmaceutical market, in particular in the retail pharmacy sector (the limitation of the trade mark-ups and the government price regulation) that would be the most optimal for Russia at present taking into account the current dynamics of the Russian pharmaceutical market of the retail pharmacy sector. In order to reach these purposes the author systematized the researches on price regulation on the level of the retail sector that have been already conducted; gave a description to the analysis of the general tendencies and the dynamics of the commercial retail sector of the Russian drug market (during the period 2013-2018); constructed a theoretical model and investigate the impact of the price growth in the retail pharmacy segment on the position of demand and supply curves. Overall, according to the results of micro-modelling (the difference between alternative future states after introducing the limitation of trade mark-ups and the reference prices), there is an evidence to confirm that the methodology of the reference prices could be the most optimal and effective way in modern Russian realities, taking into account the behavior and the economic power of the economic agents in the market of the retail pharmacy sector of Russia. Keywords: pharmaceutical market of Russia, retail pharmacy sector of Russia, government price regulation, limitation of the trade mark-ups, reference prices, retail prices, theory of supply and demand.

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