The effects of price regulation in the form , i.e. the price is set 20% lower than the optimal monopolistic price.

This price constraint lowers revenues by only 0.69%–1.18% relative to the monopolistic revenues, depending on h, the benefit provided by the drug (4). The consumer surplus is increased by 7.9%–10.8% relative to the unregulated case (6). The increase in consumer surplus is about twenty-fold to thirty-fold the decrease in revenues (7), and the number of patients using the drug increases by about 23% relative to the unregulated case.The effects of price regulation in the form , i.e. the price is set 20% lower than the optimal monopolistic price.