Pricing Problems in the Pharmaceutical Supply Chain with Mixed Channel: A Power Perspective
Round 1
Reviewer 1 Report
In this paper, the authors have addressed pharmaceutical supply chain problems. The Stackelberg Nash game model is used for optimal pricing, performance, and social welfare and compared in three different power structures to find out how price cap regulation and power structures affect the drug supply chain. However, some of my concerns regarding this paper are as follows:
- The introduction should be more elaborate and elucidate. The research questions must be identified and described in the section.
- The format of the paper should be uniform. The parameters (i.e. c, w, w>c etc.) description should be aligned (in section 3).
- Managerial insights should be described on the basis of the results obtained.
- The conclusion section should be concise and clear.
Author Response
Responses to the Reviewers’ Comments
Dear Editors and Reviewers:
Thank you for your comments concerning our manuscript entitled “Pricing problems in the pharmaceutical supply chain with mixed channel: A power perspective” (Manuscript Number: sustainability-1719099). Those comments are valuable and helpful for revising and improving our paper. We have studied these comments carefully and have made changes in this revised manuscript. Please see below for our detailed responses.
Responds to Reviewer #1:
Comment (1): The introduction should be more elaborate and elucidate. The research questions must be identified and described in the section.
Response: Thank you for this great question. We have revised it according to your request.
Line 70-78: This paper focuses on a two-echelon supply chain including a pharmaceutical manufacturer and a pharmacy with an O2O mixed channel. The government imposes price caps on the pharmaceutical manufacturer. We establish three basic models and price cap regulation models (including Pharmaceutical Manufacturer Stackelberg, Pharmacy Stackelberg, Vertical Nash) respectively. The optional pricing, profits and social welfare in three different power structures are obtained through game theory. By comparing the model equilibriums in the above models and performing sensitivity analysis on the restricted price cap (θ), we find out how power structures and whole-sale price cap affect economic and social performance.
Comment (2): The format of the paper should be uniform. The parameters (i.e. c, w, w>c etc.) description should be aligned (in section 3).
Response: Thank you for this great question. We have modified it according to your request.
Comment (3): Managerial insights should be described on the basis of the results obtained.
Response: Thank you for this great question. We have modified it in conclusions according to your request.
Comment (4): The conclusion section should be concise and clear.
Response: Thank you for this valuable suggestion. We have revised the conclusion section of the manuscript.
We tried our best to improve the manuscript and made some changes in the manuscript. These changes will not influence the content and framework of the paper. We appreciate for Reviewer #1s’ warm work earnestly, and hope that the correction will meet with approval. Once again, thank you very much for your comments and suggestions.
Yours,
Xiaojie Yang
Author Response File: 
Author Response.pdf
Reviewer 2 Report
Pricing problems in the pharmaceutical supply chain with 2 mixed channel: A power perspective
The authors propose three models (Pharmaceutical Manufacturer-Stackelberg, Pharmacy-Stackelberg, and Nash game models) to explore the impact of price cap regulation and power structures affect the drug supply chain (two echelons).
The proposed work is very interesting, however, requires some improvements:
1- Based on the literature review is not clear the literature gap. A deeper analysis should be done, to sustain the work proposed by the authors.
2- The literature review about welfare must be deeper. Almost all the literature presented exploring this topic is from the same authors.
3- How do the authors characterize social welfare?
4- Must clarify the conclusion and its comparison between price cap regulation and without it.
5- The key question presented in the introduction must be related to the conclusion., more explicitly.
Author Response
Responses to the Reviewers’ Comments
Dear Editors and Reviewers:
Thank you for your comments concerning our manuscript entitled “Pricing problems in the pharmaceutical supply chain with mixed channel: A power perspective” (Manuscript Number: sustainability-1719099). Those comments are valuable and helpful for revising and improving our paper. We have studied these comments carefully and have made changes in this revised manuscript. Please see below for our detailed responses.
Responds to Reviewer #2:
Comment (1): Based on the literature review is not clear the literature gap. A deeper analysis should be done, to sustain the work proposed by the authors.
Response: Thank you for this valuable suggestion. We have revised the statements of the manuscript as Some modifications were made in the literature review.
Comment (2): The literature review about welfare must be deeper. Almost all the literature presented exploring this topic is from the same authors.
Response: Thank you for this valuable suggestion. We have revised the statements of the manuscript as follows:
The maximization problem in the supply chain usually involves the maximization of social welfare under certain circumstances. Social welfare in supply chain consists of social surplus, profits upstream and downstream of the supply chain((Baron & Myerson,1982). Wang et al. (2015) explored the impact of carbon dioxide on transportation modes and social welfare by using a two-stage Stackelberg. Based on this model, the government's optimal carbon-emission tax scheme and the company's optimal transportation mode and production decisions are explored. Also in the context of carbon, Xue et al. (2022) considered the cap-and-trade case to explore the impact of corporate competition on carbon emission reduction and social welfare. Finally they found the HCVI strategy can bring social welfare. Chen et al. (2022) considered consumers' green dynamic perception to explore optimal production and subsidy rate under different government subsidy orientations. They shows that the subsidy rate increases with the consumer environmental awareness under social welfare orientation. Wang et al. (2020) found whether it is upstream subsidies, downstream subsidies, or both, continually increasing subsidies cannot promote the sustainable development of the supply chain but will harm social welfare. We can see the above articles all consider the issue of social welfare maximization in different contexts, so in this paper we will consider social welfare issues in the context of pharmaceutical supply chain.
Baron, David P., and Roger B. Myerson(1982). “Regulating a Monopolist with Unknown Costs.” Econometrica, vol. 50, no. 4, 1982, pp. 911–30.
Xue, K.; Sun, G. Impacts of Supply Chain Competition on Firms’ Carbon Emission Reduction and Social Welfare under Cap-and-Trade Regulation(2022). Int. J. Environ. Res. Public Health 2022, 19, 3226.
Shan Chen, Jiafu Su, Yingbo Wu, Fuli Zhou(2022), "Optimal production and subsidy rate considering dynamic consumer green perception under different government subsidy orientations", Computers & Industrial Engineering, Volume 168,2022,
- Wang, K. Liu, T. -M. Choi and X. Yue(2015), "Effects of Carbon Emission Taxes on Transportation Mode Selections and Social Welfare," in IEEE Transactions on Systems, Man, and Cybernetics: Systems, vol. 45, no. 11, pp. 1413-1423, Nov. 2015.
- Wang, S. Zhang, L. Zhang and Q. Liu(2020), "Government Subsidy Policies and Corporate Social Responsibility," in IEEE Access, vol. 8, pp. 112814-112826, 2020.
Comment (3): How do the authors characterize social welfare?
Response: Thank you for this great question. We have added a description of social welfare to the manuscript in line 51 as follows: Welfare economics considers welfare to be divided into three dimensions: individual, social and economic. Social welfare usually refers to the collection of the whole welfare obtained by a certain social group for more people.
Comment (4): Must clarify the conclusion and its comparison between price cap regulation and without it.
Response: Thank you for this valuable suggestion. We have clarified the conclusion and its comparison between price cap regulation and without it in lines 424-441 of the manuscript.
Comment (5): The key question presented in the introduction must be related to the conclusion., more explicitly.
Response: Thank you for this great question. We have revised it according to your request.
We tried our best to improve the manuscript and made some changes in the manuscript. These changes will not influence the content and framework of the paper. We appreciate for Reviewer #2s’ warm work earnestly, and hope that the correction will meet with approval. Once again, thank you very much for your comments and suggestions.
Yours,
Xiaojie Yang
Author Response File: Author Response.pdf
Reviewer 3 Report
The authors have done good work. Some of the wordiness issues should be addressed.
Author Response
Thank you for your comments concerning our manuscript entitled “Pricing problems in the pharmaceutical supply chain with mixed channel: A power perspective” (Manuscript Number: sustainability-1719099). Those comments are valuable and helpful for revising and improving our paper.
We tried our best to improve the manuscript and made some changes in the manuscript.
Author Response File: Author Response.pdf
Round 2
Reviewer 1 Report
The authors have addressed all the comments and suggestions.
Reviewer 2 Report
The paper can be submitted as it is.
