E-DRUG: Pharma companies overcharge American employers & taxpayers > $116 billion/yr
---------------------------------------------------------------------------------------------------------
Last Friday, Health Affairs Blog published an article that may be of interest.
Here is my summary:
A new analysis of data on US prices finds that pharmaceutical companies charge American employers and taxpayers about $116 billion more for 20 top-selling drugs as they charge in a sample of other affluent countries. The overcharge for all patented drugs is probably almost double.
Published in Health Affairs,
http://healthaffairs.org/blog/2017/06/02/debunking-the-pharmaceutical-research-free-rider-myth-a-response-to-yu-helms-and-bach/
the analysis by Donald Light concludes that companies charge 2.4 times more to Americans than to other affluent countries.
“This is one way that President Trump and Congress could reduce health care spending,” said Light, a professor of comparative health care at the Rowan University School of Osteopathic Medicine.
Health care costs could be cut by more than $150 billion in the next ten years, Light estimates, largely by cutting marketing and lobbying budgets, not research. State governments could save on health care for employees too.
Pharmaceutical companies claim that higher US prices are needed to pay for research and development (R&D). However, prices at Canadian and European levels already pay for R&D.
For example, UK prices have long been set so that they recover all R&D costs plus other expenses and reasonable profits. Yet they are much lower than prices that companies charge to Americans. Most of the overcharge in the US goes to marketing physicians, lobbying legislators, and additional profits.
Thanks,
Don
Professor, Rowan University School of Osteopathic Medicine
Guest researcher, Princeton & NYU
"Donald W. Light Jr." <dlight@princeton.edu>
E-DRUG: Pharma companies overcharge American employers & taxpayers > $116 billion/yr (2)
-------------------------------------------------------------------------------------------------
Further to Don Light's post here is the abstract from an article that I recently had published:
The title of the article is Myths and Realities About Why Prescription Drug Prices in the United States Are So High.
Abstract
Prescription medications cost more in the USA than in any other developed country. The reasons for those high prices are contested between defenders of the pharmaceutical industry and critics.
The industry claims that prices are due to the high cost of research and development necessary to bring a new drug to market and because high US prices subsidize lower prices in other developed
countries.
Critics of the industry maintain that high prices are the result of high profit levels, the rapid uptake of new more expensive drugs that offer little to no therapeutic advantage over older less expensive products, the cost of promotion, and, finally, the fact that companies base prices on what the market will pay.
This article examines the evidence behind each of these claims. High drug prices have both economic and clinical consequences; however, to deal with prices, it is first necessary to separate myths from reality.
Pharmaceutical Medicine 2017; 31:143-148.
The link for the article is:
https://link.springer.com/article/10.1007/s40290-017-0191-9.
The actual article is behind a pay wall.
[Other books published by Joel are - end of September 2016r: Private Profits vs Public Policy: The Pharmaceutical Industry and the Canadian State (University of Toronto Press) and a second book published at the end of April: Doctors in Denial: Why Big Pharma and the Canadian Medical Profession Are Too Close For Comfort (Lorimer). Both have been mentioned through e-drug and are available through commercial channels. BS]
Joel Lexchin
--
Joel Lexchin MD
121 Walmer Rd.
Toronto ON
Canada M5R 2X8
E mail: joel.lexchin@utoronto.ca