5 causes expensive prescription drugs in the US

5 main findings:

1. Drug manufacturers in the US set their own prices, which is different from traditional pricing in the world. In states with national health programs, there are state institutions that either agree on drug prices or decide not to compensate those of them for which, in their opinion, prices are too high. In the US, no discussion on this issue is not conducted. Medicaid must cover all medications approved by the US Food and Drug Administration (FDA)FDA), regardless of whether there are more effective and cheap drugs on the market. Pharmacies that sell prescription drugs, such as CVS Health and Express Scripts, receive funds from manufacturers, who are thus trying to change the situation in the market in their favor.

2. The US patent system allows drug manufacturers to remain the only drug manufacturers that they patented 20 or more years ago. FDA also provides exclusive rights to certain products, including those needed by people with rare diseases. By allowing companies to have a monopoly on certain drugs, the government prevents generic or previously generic drugs from entering the market, which could affect pricing. According to scientists, the presence of at least two similar drugs reduces prices on the market by 55%, and five - by 33% of the original price.

3. The FDA spends too much time tolerating generic drugs. Certain flaws in the department in terms of filing applications, as stated in the report, led to the fact that manufacturing companies had to wait for 3-4 for a year to authorize the production of drugs for which there is no patent.

4. At times, laws in some states and other federal regulations adopted “with the best of intentions” limit the ability of manufacturers of generic drugs to set low prices. Pharmacists in 26 US states are required by law to obtain patient consent before offering a generic drug. In 2006, the Zocor-branded drug reportedly cost Medicaid $19,8 million because it had to cover the more expensive brand despite having a cheaper product available.

5. Drug makers often attribute high costs to research and development costs, although Kesselheim and his team say they believe there is no obvious connection between the factors. In most cases, research costs for new drugs are covered by the National Institutes of Health, which is part of the US Department of Health, through federal grants. If not, they are financed by private investors. According to the authors of the study, companies spend about 10-20% of turnover on research and product development.

The pharmaceutical and biotechnology sectors, according to the report, are among the most successfully developing in the US economy.

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