Introduction

The pharmaceutical industry has produced wondrous scientific advances, but the progress has come at a cost. US prescription drug spending has increased faster in most recent years than other categories of health and now comprises roughly one-sixth of total health expenditures. Rising costs strain already stretched public budgets. Increasing patient out-of-pocket spending for deductibles and coinsurance has created financial difficulties for many individuals and their families, particularly among the sickest patients. The dueling trends of scientific breakthroughs and ever-rising spending present enduring challenges. On its own, rising spending would not be so concerning, but evidence suggests that drug prices often do not reflect the benefits they provide. Thus, there is an imperative to measure the value of prescription drugs and incorporate such measures into drug pricing policies.

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Prescription Drug Priorities under the Biden Administration

Journal of Health Politics Policy and Law ◽

10.1215/03616878-8970810 ◽

2021 ◽

Author(s):

Kyle A. Gavulic ◽

Stacie B. Dusetzina

Keyword(s):

Health Care ◽

Health Insurance ◽

Prescription Drug ◽

Prescription Drugs ◽

Insurance Coverage ◽

Public Support ◽

Economic Downturn ◽

Drug Spending ◽

Drug Prices ◽

Prescription Drug Spending

Abstract In January 2021, the incoming Biden administration will inherit urgent priorities to curb health care spending and expand health care coverage to millions of Americans while also addressing the COVID-19 pandemic and resulting economic downturn. Among these competing priorities is the issue of access to and affordability of prescription drugs. Here, we outline Biden’s plan to directly lower prescription drug spending for payers and patients and to expand access to prescription medications through improved health insurance coverage. These policies could provide important financial protections for Americans against high prescription drug prices. Despite widespread public support for addressing prescription drug prices, many of Biden’s plans rely on Congressional action, which will be complicated by the narrow majority held by Democrats in the House and an evenly divided Senate. However, there may be other opportunities to reduce prescription drug spending and improve health insurance enrollment among the uninsured. While directly lowering drug prices would provide the most widespread savings for payers and patients alike, any successful effort to increase the number of Americans enrolled in health insurance or render it more affordable will still likely effectively lower patients’ out-of-pocket costs and improve access to prescription drugs.

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Do Market Components Account for Higher US Prescription Prices?

Annals of Pharmacotherapy ◽

10.1177/106002809603001219 ◽

1996 ◽

Vol 30 (12) ◽

pp. 1489-1494 ◽

Cited By ~ 5

Author(s):

Maura J Monaghan ◽

Michael S Monaghan

Keyword(s):

New York ◽

Pharmaceutical Industry ◽

Research And Development ◽

Prescription Drug ◽

Prescription Drugs ◽

Pink Sheet ◽

New York Times ◽

Asymmetry Of Information ◽

Pricing Policies ◽

Drug Prices

BACKGROUND: Although only 7–8% of US healthcare expenditures are spent on prescription drug products, the pharmaceutical industry's profitability and high cost of prescriptions to consumers make prescription drugs a visible target for reform. When compared with other products, it appears as if unfair pricing tactics are used. The pharmaceutical industry cites costs of research and development and a short patent life as justifiable grounds for high prices, but the reason why US drug prices appear to be so high has yet to be answered. OBJECTIVE: To examine identified components of the pharmaceutical industry that allow US prescription drugs to appear to be highly priced and to review the apparent factors that affect pricing policies for pharmaceuticals. DATA SOURCES: The literature was reviewed to identify current research regarding the pharmaceutical market. Sources included MEDLINE, Econolit, Business Periodical Index, International Pharmaceutical Abstracts, the Wall Street Journal, New York Times, and the F-D-C Pink Sheet. SUMMARY: Key factors account for the fact that US prescription drug prices are higher and that price discrimination occurs in the pharmaceutical industry within the US and among other countries. These factors include the unique market structure of the pharmaceutical industry, asymmetry of information, research and development costs, numerous channels of distribution and the differences among them, and government laws and regulations of prescription drugs. Pricing policies of pharmaceutical companies are based on manufacturing, promotion, and distribution costs; drug characteristics; and economic goals of the parent company.

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Drug Pricing Transparency: The New Retail Revolution

Hospital Pharmacy ◽

10.1310/hpj5202-155 ◽

2017 ◽

Vol 52 (2) ◽

pp. 155-159 ◽

Cited By ~ 5

Author(s):

Kaitlyn N. Dana ◽

John B. Hertig ◽

Robert J. Weber

Keyword(s):

Health Care ◽

The United States ◽

Pharmacy Services ◽

Drug Spending ◽

Drug Pricing ◽

Patient Centered ◽

Pricing Policies ◽

Drug Prices ◽

Pharmacy Leaders

As spending on medications in the United States increases with each passing year, the need for drug pricing transparency by manufacturers also increases. Drug spending, excluding rebates and discounts, was $309.5 billion in 2015, up 8.5% from 2014. Drug pricing transparency has been a topic of debate across the health care system. This column reviews the issue of drug pricing and emphasizes the need for transparency in this area. We will discuss factors that influence drug pricing, policies and ways to reduce the rising costs of drugs, and the role of pharmacy leaders in managing this problem. A multitude of factors are driving the country to spend more and more on medications; pharmacy leaders can employ various strategies to counteract this escalation of drug prices. After reviewing this article, the pharmacy director will have an increased ability to address drug pricing issues with stakeholders as they develop patient-centered pharmacy services.

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