A novel supply-side measure to combat abuse of addictive prescription drugs

In the United States, 115 people die each day due to overdose, and a third of overdoses involve the concurrent use of opioids and a class of sedatives called benzodiazepines. Facing a similar problem in 2012, Austria responded by installing public health officers (PHOs) as third-party institutions overseeing prescriptions of the most potent and commonly abused benzodiazepine, flunitrazepam. Since December 15, 2012, every single flunitrazepam prescription must be authorized and countersigned by a PHO, prescriptions were restricted to a month’s supply of the drug, and doses must be dispensed daily, under supervision, in a pharmacy. I identify a sample of opioids addicts in administrative social security data and study their response to this reform. Event studies suggest a persistent decline in flunitrazepam prescriptions but substitution to less potent benzodiazepines following the reform. To examine subsequent health, labor market, and drug abuse-related outcomes, I additionally exploit regional variation in PHO strictness affecting the likelihood that addicts opt to quit the drug due to the reform. I find that addicts who quit after encountering a strict PHO have better health and labor market outcomes, have fewer opioid overdoses, and are less likely to take antidepressants or weak opioids. I discuss how these findings translate to the US setting, and whether a similar policy can help curb its opioid epidemic.