Common ownership in the pharmaceutical industry

Common ownership - where several firms are partially owned by the
same investor - and its impact on product markets has recently
drawn a lot attention from both academics and policy makers.
Institutional investors, such as BlackRock and Vanguard, have
rapidly increased in importance in recent years. Their growing
diversified portfolios have led to a steep increase in common
ownership, which in turn has raised concerns worldwide about the
potential distortion this creates into firms' decision making. Dubbed
“the major new antitrust challenge of our time,” common ownership is
an important, new topic in competition economics. But –although
rapidly growing– research on the topic is still in its infancy. This
project aims to assess in detail in US pharmaceutical industries the
impact of common ownership on market entry strategies, and to
investigate the resulting welfare consequences. The aimed
contribution of the project is to give new and detailed insights in large
investors’ influence in product markets, how this exactly affects firms’
entry strategies, and the resulting market outcomes in an important
and well-suited industry for the research questions at hand, i.e.
pharma.