Top-Selling Drugs Cost 3 Times More in U.S.
Prices for the world's 20 top-selling medicines are, on average, three times higher in the U.S. than in Great Britain and consistently higher than in other European countries.
That's the conclusion of a new analysis completed at the University of Liverpool at the request of the Reuters News.
The big reason the U.S. has some of the highest drug prices in the world is because it allows price levels to be set by market competition, whereas in many other countries, the government directly or indirectly controls medical costs.
According to Express Scripts, the largest U.S. manager of drug plans, prices in the U.S. for top brand-name drugs jumped 127 percent between 2008 and 2014. During the same period, the cost of a basket of common household goods, by comparison, rose just 11 percent. In Europe, many governments have capped costs or even helped lower prices.
That makes the U.S. by far the most profitable market for pharmaceutical companies, leading to complaints that Americans are effectively subsidizing health systems elsewhere.
In defending the wide price gap, the U.S. Pharmaceutical Research and Manufacturers of America (PhRMA) says international comparisons are misleading because list prices do not take into account discounts available as a result of "aggressive negotiation" by U.S. insurers.
PhRMA also argues that while Americans may pay more for drugs when they first come out, they pay less as drugs get older, since nearly 90 percent of all medicines prescribed to U.S. patients are now cheaper generics.
However, generics of top-selling drugs generally are much slower to arrive in the U.S. market.
Overall, the biggest price difference was found in older brand-name drugs, where prices are typically increased each year in the U.S. A smaller price difference was found in complex antibody-based drugs, which are used to treat conditions such as cancer and rheumatoid arthritis.