Estimating the shares of merchandise diverted from shipments to other countries

The Situation

Certain pharmaceutical products, when they are sold in certain countries outside of the United States, have prices that are required by law to be lower than those being charged in the United States. Certain of this merchandise is intercepted in these countries and then returned to the United States, where it is sometimes sold in various outlets.


NERA's Role

NERA statisticians, over a period of several years, selected several samples of independent drug stores to which investigators were sent to determine whether such "diverted merchandise" was being sold. NERA statisticians selected the samples and analyzed the data that were collected on the basis of these samples. The NERA statisticians estimated the amount and geographic distribution of the diverted merchandise being sold in the United States.