But in health care, this gray market has two problems: First, many people are morally troubled by the dramatic increase in price that prescription drug gray markets produce.
This is putting pressure on the Obama administration and the FDA to do more about drug shortages and the gray markets.
But it's possible that drug makers could act before the FDA in tamping down on the gray markets, motivated by both political and economic interests.
Beneficial Effects of Gray Markets for Brand Owners
In addition to problems stemming from inability to support products sold in gray markets, another problem stems from the type of product information (repackaging) that occurs in the resale of the good, which can affect the consumers' perception of the branded product [Chaudhry and Walsh 1995].
The arbitrage function of gray markets may thus have a direct, adverse impact on their earnings.
Pyramid believes that shrinking gray markets in Africa depends on manufacturers and operators providing the right incentives for end users to buy authentic handsets, rather than solely branding gray markets as illegitimate," says Kerem Arsal, Analyst at Pyramid.
In fact, any loss of revenue due to selling indirectly can easily be counteracted by the scale and certainty provided by powerful mobile operators, as well as by recovering the loss of market share to gray markets," Arsal adds.
Squashing Gray Markets for Mobile Handsets is part of Pyramid Research's Telecom Insider Report Series and is priced at $595.
At its core, gray market leakage results from a lack of discipline over the manufacturer's end-to-end value chain.
The Alliance for Gray Market and Counterfeit Abatement, an initiative composed of technology companies, reports that "over $40 billion in legitimate IT products move through the gray market channel each year, resulting in $5 billion in lost profits annually to IT manufacturers.
TORONTO -- The European Commission introduced bold new laws today to stop car manufacturers from restricting gray market sales.
The European Commission found that manufacturer imposed restrictions hurt consumers and new rules to protect the gray market were needed.
His presentation will touch on a number of issues regarding the IT counterfeit and gray markets, including how they affect consumers, the impact of the sales process, potential impacts of non-compliance on OEMs, the channel and end users, and how to curb or prevent the problem.
The Alliance for Gray Market and Counterfeit Abatement (AGMA), a non-profit organization dedicated to curbing the gray marketing and counterfeiting of technology products around the globe, today announced its President, Nick Tidd, will speak at a IQPC event on Anti-Counterfeiting and Brand Protection, that takes place October 25-27, 2006 at the Affinia Manhattan Hotel in New York City.