I’m an applied microeconomist interested in competition and innovation, with a particular topic focus on the pharmaceutical industry and prescription drug policy. I received my PhD in Health Policy & Management from Harvard Business School in 2026 and will begin as a Faculty Fellow at Brown University’s Department of Health Services, Policy & Practice in Summer 2026.

Email: olivia_zhao1 @ brown.edu

Job Market Paper: Policy Incentives for Pharmaceutical Innovation (Latest draft)

Abstract: Pharmaceutical firms’ incentives to develop new drugs stem from expected profitability. We explore how market exclusivity, a policy that shapes these expectations, influences pharmaceutical innovation. First, we estimate the effects of extending market exclusivity for antibiotics, a drug class where private returns to development historically had not internalized the high social value of new innovation. Using a difference-in-differences approach, we find that a policy that approximately doubled the market exclusivity period for certain antibiotics increased innovative activity. Patent filings for antibiotics increased by 47%, and we find suggestive evidence that preclinical studies and phase 3 trial initiations also increased under the policy. Building on these empirical findings, we estimate a structural model of firms’ drug development decisions to predict how market exclusivity extensions of varying lengths would affect innovation in antibiotics and other therapeutic areas. Our reduced form and structural findings suggest that market exclusivity—especially if targeted to high-social-value, low-market-return areas—can be an effective tool for realigning incentives and stimulating innovation, but stress that baseline market size and interactions between market and patent exclusivities affect this policy lever’s impacts.