Tough versus soft regulations to promote generic medications in Italy

This paper investigates the effects of regulations aiming to optimise the multi-agency relationships, with a focus on the prescription choice between generic versus branded medications. In 2012, Italian legislators introduced two laws targeting general practitioners prescription behaviour, a soft (recommendations) law followed by a hard (mandatory) law to promote generic medication. We implement a regression discontinuity in time framework and an event study to quarterly administrative data for individuals with chronic kidney disease linked to data from their general practitioners in Emilia-Romagna, Italy. The results indicate that the policies were effective, but had modest effects on increasing the prescription of generic medications. Hard laws seem to have played a key role in driving this change. Heterogeneity checks provide evidence that less competition among GPs and interaction with specialists increased generic medication prescriptions.