Comparative Approaches to Drug Pricing.

Comparative Approaches to Drug Pricing. Annu Rev Public Health. 2019 Dec 24;: Authors: Kang SY, Bai G, DiStefano MJ, Socal MP, Yehia F, Anderson GF Abstract The United States relies primarily on market forces to determine prices for drugs, whereas most other industrialized countries use a variety of approaches to determine drug prices. Branded drug companies have patents and market exclusivity periods in most industrialized countries. During this period, pharmaceutical companies are allowed to set their list price as high as they prefer in the United States owing to the absence of government price control mechanisms that exist in other countries. Insured patients often pay a percentage of the list price, and cost sharing creates some pressure to lower the list price. Pharmacy benefit managers negotiate with drug companies for lower prices by offering the drug company favorable formulary placement and fewer utilization controls. However, these approaches appear to be less effective, compared with other countries' approaches to containing branded drug prices, because prices are substantially higher in the United States. Other industrialized countries employ various forms of rate setting and price regulation, such as external reference pricing, therapeutic valuation, and health technology assessment to determine the appropriate price. Expected final online publication date for the Annual Review of Public Health, Volume 41 is April 1, 20...
Source: Annual Review of Public Health - Category: International Medicine & Public Health Authors: Tags: Annu Rev Public Health Source Type: research