Extended Producer Responsibility for Pharmaceuticals

2021 ◽  
Author(s):  
Işıl Alev ◽  
Atalay Atasu ◽  
L. Beril Toktay ◽  
Can Zhang
Keyword(s):  
Social Impact ◽  
Health Impact ◽  
Problem Definition ◽  
Theoretic Model ◽  
Extended Producer Responsibility ◽  
Source Reduction ◽  
Implementation Model ◽  
Producer Responsibility ◽  
Implementation Models ◽  
Total Welfare

Problem definition: We investigate the effectiveness of different extended producer responsibility (EPR) implementation models for pharmaceuticals. In particular, we study two viable and prevalent models: (1) source reduction (SR), where a form of fee on sale is imposed on producers, and (2) end-of-pipe control (EC), where producers are made responsible for the collection of unused pharmaceuticals. Academic/practical relevance: The existing literature on EPR implementation models has focused primarily on nonconsumable products (e.g., electronics), whereas there is limited research on the effectiveness of different EPR implementation models for pharmaceuticals used in practice. We aim to fill this gap in this study. Methodology: We develop a game-theoretic model to characterize the equilibrium strategies of different stakeholders under both the SR and EC models and compare the resulting producer profit, environmental/social impact, and total welfare. Results: In contrast to the nonconsumable contexts where the SR model is shown to maximize total welfare, the EC model leads to a higher total welfare for certain categories of pharmaceuticals because of its effectiveness in eliminating overprescription. Moreover, we characterize conditions under which stakeholder (e.g., producer, environmental/social advocacy groups) preferences toward EPR implementation model choices are (mis-)aligned. We further show that limiting the social planner’s budget surplus under SR can eliminate the preference misalignment but leads to a loss of total welfare. Managerial implications: (1) Policymakers should be cautious about directly applying preferred EPR models from other product categories to the pharmaceutical setting. (2) The EC model maximizes the objectives of all stakeholders for a salient category of pharmaceuticals with high health benefits, high collection costs, and high environmental/social costs. (3) Policymakers should give thought to differentiating EPR implementation models across pharmaceutical categories. (4) It is important to carefully quantify the health impact of the pharmaceuticals and the operational cost parameters to inform policymaking.

scholarly journals Enabling Reuse in Extended Producer Responsibility Schemes for White Goods: Legal and Organisational Conditions for Connecting Resource Flows and Actors

2021 ◽  
Author(s):  
Carl Dalhammar ◽  
Emelie Wihlborg ◽  
Leonidas Milios ◽  
Jessika Luth Richter ◽  
Sahra Svensson-Höglund ◽  
...  
Keyword(s):  
End Of Life ◽  
Energy Recovery ◽  
Large Scale ◽  
Empirical Investigation ◽  
Extended Producer Responsibility ◽  
Waste Streams ◽  
Pilot Projects ◽  
Waste Hierarchy ◽  
Producer Responsibility ◽  
White Goods

AbstractExtended producer responsibility (EPR) schemes have proliferated across Europe and other parts of the world in recent years and have contributed to increasing material and energy recovery from waste streams. Currently, EPR schemes do not provide sufficient incentives for moving towards the higher levels of the waste hierarchy, e.g. by reducing the amounts of waste through incentivising the design of products with longer lifespans and by enhancing reuse activities through easier collection and repair of end-of-life products. Nevertheless, several municipalities and regional actors around Europe are increasingly promoting reuse activities through a variety of initiatives. Furthermore, even in the absence of legal drivers, many producer responsibility organisations (PROs), who execute their members’ responsibilities in EPR schemes, are considering promoting reuse and have initiated a number of pilot projects. A product group that has been identified as having high commercial potential for reuse is white goods, but the development of large-scale reuse of white goods seems unlikely unless a series of legal and organisational barriers are effectively addressed. Through an empirical investigation with relevant stakeholders, based on interviews, and the analysis of two case studies of PROs that developed criteria for allowing reusers to access their end-of-life white goods, this contribution presents insights on drivers and barriers for the repair and reuse of white goods in EPR schemes and discusses potential interventions that could facilitate the upscale of reuse activities. Concluding, although the reuse potential for white goods is high, the analysis highlights the currently insufficient policy landscape for incentivising reuse and the need for additional interventions to make reuse feasible as a mainstream enterprise.

‘Our Waste, our Resources; A Strategy for England’– Switching to a circular economy through the use of extended producer responsibility

2019 ◽  
Vol 21 (3) ◽  
pp. 210-218
Author(s):  
Louis Dawson
Keyword(s):  
Waste Disposal ◽  
Circular Economy ◽  
Food Environment ◽  
Extended Producer Responsibility ◽  
Legislative Agenda ◽  
Producer Responsibility ◽  
Polluter Pays Principle ◽  
Potential Use

High landfill rates compared with flatlining rates of recycling have ensured that waste disposal is once again on the legislative agenda in England. In 2018, the Department for Food, Environment and Rural Affairs published ‘Our Waste, Our Resources: A Strategy for England’ which is the first major policy publication on waste since 2013. Encouraged by the release of this Strategy, this article examines the potential use of extended producer responsibility and the ‘polluter pays’ principle to fuel the transition to a circular economy.

Coping with Spatial Mismatch: Subsidy Design for Electric Vehicle and Charging Markets

2021 ◽  
Author(s):  
Wei Zhang ◽  
Yifan Dou
Keyword(s):  
Electric Vehicle ◽  
Service Providers ◽  
Supply And Demand ◽  
Problem Definition ◽  
Environmental Benefits ◽  
Third Party ◽  
Theoretic Model ◽  
Spatial Mismatch ◽  
The Government ◽  
Ev Charging

Problem definition: We study how the government should design the subsidy policy to promote electric vehicle (EV) adoptions effectively and efficiently when there might be a spatial mismatch between the supply and demand of charging piles. Academic/practical relevance: EV charging infrastructures are often built by third-party service providers (SPs). However, profit-maximizing SPs might prefer to locate the charging piles in the suburbs versus downtown because of lower costs although most EV drivers prefer to charge their EVs downtown given their commuting patterns and the convenience of charging in downtown areas. This conflict of spatial preferences between SPs and EV drivers results in high overall costs for EV charging and weak EV adoptions. Methodology: We use a stylized game-theoretic model and compare three types of subsidy policies: (i) subsidizing EV purchases, (ii) subsidizing SPs based on pile usage, and (iii) subsidizing SPs based on pile numbers. Results: Subsidizing EV purchases is effective in promoting EV adoptions but not in alleviating the spatial mismatch. In contrast, subsidizing SPs can be more effective in addressing the spatial mismatch and promoting EV adoptions, but uniformly subsidizing pile installation can exacerbate the spatial mismatch and backfire. In different situations, each policy can emerge as the best, and the rule to determine which side (SPs versus EV buyers) to subsidize largely depends on cost factors in the charging market rather than the EV price or the environmental benefits. Managerial implications: A “jigsaw-piece rule” is recommended to guide policy design: subsidizing SPs is preferred if charging is too costly or time consuming, and subsidizing EV purchases is preferred if charging is sufficiently fast and easy. Given charging costs that are neither too low nor too high, subsidizing SPs is preferred only if pile building downtown is moderately more expensive than pile building in the suburbs.

The Effects of Patent Extension and Take-Back Regulation on Green Pharmacy

2021 ◽  
Author(s):  
Tianqin Shi ◽  
Nicholas C. Petruzzi ◽  
Dilip Chhajed
Keyword(s):  
Pharmaceutical Industry ◽  
Social Welfare ◽  
Technical Information ◽  
Problem Definition ◽  
Theoretic Model ◽  
Innovative Company ◽  
Take Back ◽  
Starting Point ◽  
European Environmental Agency ◽  
Managerial Implications

Problem definition: The eco-toxicity arising from unused pharmaceuticals has regulators advocating the benign design concept of “green pharmacy,” but high research and development expenses can be prohibitive. We therefore examine the impacts of two regulatory mechanisms, patent extension and take-back regulation, on inducing drug manufacturers to go green. Academic/practical relevance: One incentive suggested by the European Environmental Agency is a patent extension for a company that redesigns its already patented pharmaceutical to be more environmentally friendly. This incentive can encourage both the development of degradable drugs and the disclosure of technical information. Yet, it is unclear how effective the extension would be in inducing green pharmacy and in maximizing social welfare. Methodology: We develop a game-theoretic model in which an innovative company collects monopoly profits for a patented pharmaceutical but faces competition from a generic rival after the patent expires. A social-welfare-maximizing regulator is the Stackelberg leader. The regulator leads by offering a patent extension to the innovative company while also imposing take-back regulation on the pharmaceutical industry. Then the two-profit maximizing companies respond by setting drug prices and choosing whether to invest in green pharmacy. Results: The regulator’s optimal patent extension offer can induce green pharmacy but only if the offer exceeds a threshold length that depends on the degree of product differentiation present in the pharmaceutical industry. The regulator’s correspondingly optimal take-back regulation generally prescribes a required collection rate that decreases as its optimal patent extension offer increases, and vice versa. Managerial implications: By isolating green pharmacy as a potential target to address pharmaceutical eco-toxicity at its source, the regulatory policy that we consider, which combines the incentive inherent in earning a patent extension on the one hand with the penalty inherent in complying with take-back regulation on the other hand, serves as a useful starting point for policymakers to optimally balance economic welfare considerations with environmental stewardship considerations.

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