U.S. prescription drug prices are about 2.8 times those paid in other countries
The United States accounts for 62% of money paid to drug companies, but only 24% of total drugs sold
Brand-name drugs fuel this trend, with U.S. prices averaging 4.2 times those of other nations
MONDAY, Feb. 5, 2024 (HealthDay News) -- Americans pay nearly three times as much for their prescription drugs as residents of other nations do, new research shows.
Drug prices in the United States average nearly 2.8 times those seen in 33 other countries, the report from RAND Health Care found.
Brand-name drugs are even more expensive, with U.S. prices averaging 4.2 times those in comparable nations, the researchers added.
On the other hand, Americans receive a real bargain when it comes to unbranded generic drugs. Those run about two-thirds (67%) the average price found in comparable countries.
“These findings provide further evidence that manufacturers’ gross prices for prescription drugs are higher in the U.S. than in comparison countries,” said lead researcher Andrew Mulcahy, a senior health economist at RAND.
“We find that the gap is widening for name-brand drugs, while U.S. prices for generic drugs are now proportionally lower than our earlier analysis found,” Mulcahy added in a RAND news release.
Generics account for 90% of prescription drugs sold in the United States, the researchers noted.
For the report, researchers compared U.S. drug prices to those of 33 other countries in the Organization for Economic Co-operation and Development (OECD).
Across all of the OECD nations studied, total drug spending was $989 billion in 2022, results show.
The United States accounted for 62% of the money paid to drug companies, but only 24% of the total drugs sold.
U.S. drug prices ranged from 1.7 times prices found in Mexico to more than 10 times prices in Turkey.
The analysis relied on manufacturer’s gross prices for drugs because net prices -- what is actually charged after negotiated rebates and discounts -- are not systematically available.
However, estimates that attempted to account for those discounts found that U.S. prices for brand-name drugs are still more than three times higher than those in other countries.
Retail prescription drug spending in the United States increased by 91% between 2000 and 2020, and spending is expected to increase 5% a year through 2030, researchers said. Prescription drugs now account for more than 10% of all health care spending in the United States.
KFF has more about prescription drug prices.
SOURCE: RAND Health Care, news release, Feb. 1, 2024
Generic drugs provide a less costly alternative to brand-name drugs in America.