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Why Are Drugs More Expensive in U.S. than in Other Countries?

| Oct 14, 2013 | Drug and Medical Device Litigation, General Interest

Across America and throughout the world people with the same condition take the same drugs.  However, the prices vary greatly.  Take asthma, which affects 40 million Americans and countless millions throughout the world and is estimated by the Center for Disease Control and prevention to cost Americans $56 billion annually.

One of the leading asthma drugs is Advair by GSK.

As The New York Times reports, one Advair Diskus inhaler runs $250 in the U.S., at retail prices.  In France, $250 buys 7 Advair inhalers.  For another $250, a U.S. allergy patient gets two bottles of the steroid nasal spray Rhinocort; a Romanian patient would get 51 bottles for the same price.

Why the difference?

Some would tell you it is the free market at play while others would decry the effects of socialism.  But it is clear that politics significantly effects what consumers ultimately pay for drugs.  In countries where healthcare is the province of the state, governments negotiate lower drug prices.  The U.K. has an agency, the National Institute for Health and Care Excellence that assesses new drugs for cost-effectiveness and can reject them for routine use by the National Health Service.  Many other countries look to these recommendations in making their own decisions while other countries go through the same decision-making process as in the U.K.

However, in the U.S., Medicare is forbidden from negotiating drug process.  When the idea of negotiating drug prices was floated as part of Obama care, it was quickly rejected by Congress.  In the U.S., drug prices are left to competition (or lack thereof) amongst pharmaceutical companies, where often only one company is making a patented drug.

Drugs account for 10% of the U.S. $2.7 trillion annual health bill.  Some suggest that the reason Americans pay much more is the effect of a $250 billion lobbying campaign, which, according to the New York Times article, is more than even the defense industry spends on lobbying activities.  But one thing is certain.  Americans, who are bombarded by ads for drugs, pay more for the same product as people where advertizing is not common, and governments are able to buy at negotiated rates.  If the drug giants will negotiate with smaller countries resulting in savings for people and profits for the companies, what would happen if the same thing occurred in the U.S.?

Click here to read the full New York Times article: The Soaring Cost of a Simple Breath

The Brandi Law Firm is nationally recognized for its long involvement in cases involving defects in drugs or devices, from DePuy metal on metal hips, Fosamax, Actos to vaginal mesh.  Currently, the firm is actively investigating potential claims for women who have taken Lipitor and been diagnosed with Type II Diabetes, which medical studies indicate, may be causally related.  If you would like more information, please contact the Brandi Law Firm by e-mail or call 415-989-1800 or (800) 481-1615.