Problem:
Eli Lily holds the patent to Prozac. !n 1996, Barr Laboratories challeneged Lili's patent. In 1999 U.S District Judge Barker held in favor of Liliy. Lily reduced its expenditure on direct-to-consumer advertising that same year on Prozac from 37.5million to just 151,000, while raising the expenditure on detailing to physicians from 49.9million to 60.2 million, and raised advertising in medical journals from 7.9 million to 8.1 million. The U.S. court of appeals overturned the patent and generic competition was expected to begin in 2001.
A: Was Lili's decision to redirect promotion spending away from consumers to doctors consistent with Judge Barker's decision. Please explain.
B: Following the intoduction of generic drugs, how should Lily adjust to the price of Prozac? Please explain.
C: Following the introduction of generic drugs, how should Lily adjust to the promotion of Prozac? Please explain.