Policy options for the drug pricing conundrum.
other · Level V
Where this comes from
- Record sourced from PubMed, PMID 39999179.
- Also identified by DOI 10.1073/pnas.2418540122 and PMC identifier 11892685.
- Licence recorded as CC BY-NC-ND.
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Abstract
Current proposals aimed at reducing U.S. pharmaceutical prices would have immediate benefits (particularly for low-income and elderly populations), but could dramatically reduce firms' investment in potentially highly welfare-improving Research and Development (R&D). The United States subsidizes the worldwide pharmaceutical market: U.S. drug prices are more than 250% of those in other Organization for Economic Co-operation and Development (OECD) countries. If each drug had a single international price across the highest-income OECD countries and total pharmaceutical firm profits were held fixed: U.S. prices would fall by half; every other country's prices would increase (by 28 to over 300%); and R&D incentives would be maintained. We propose a potential lever for the U.S. government to influence worldwide drug pricing: access to the Medicare market.
Medical subject headings
- Drug Costs
- Drug Industry