Swelling Affordability Gap: U.S. Drug Prices Remain Sky-High Even After Inflation Reduction Act
Despite recent negotiations aimed at lowering drug prices, Americans still face exorbitant costs compared to their counterparts in developed nations, a new study reveals. The research, led by the London School of Economics and published in JAMA, paints a stark picture of the affordability gap in U.S. healthcare.
Examining ten drugs freshly targeted for price negotiations under the Biden administration’s Inflation Reduction Act, researchers compared U.S. prices to those in Germany, the UK, Australia, Switzerland, Canada, and France. The findings are unequivocal: even after the negotiations, U.S. drug prices remain, on average, nearly five times higher.
"While the study shows an average decrease in U.S. drug prices, they remain up to 4 times higher compared to those from other industrialized countries," explains Dr. Eric Arzubi, CEO of Frontier Psychiatry. "I’m not sure we can call that a win."
For example, Jardiance, a diabetes medication produced by German-based Boehringer Ingelheim, costs $197 per month in the U.S., 4.8 times higher than the Australian price of $33. Similarly, Stelara, an injection for Crohn’s disease, psoriasis, and ulcerative colitis, will still cost about $4695 per 30 days of treatments in the U.S., compared to $1341 in Australia and $1291 in the UK.
“I think everyone knew that this [negotiation] wasn’t going to have major impacts," Dr. Jared Ross, President of Emergency Medical Services, Education & Consulting tells DailyMail.com, "but this was so that we could show both from the politician side as well as from pharma side that they were trying to to change this, or at least giving the outward impression of changing it.”
Even drugs manufactured by U.S. companies fail to offer any reprieve. Xarelto, Eliquis, and Enbrel are all produced in America yet remain significantly more expensive for American consumers.
Beyond Negotiation: The Root of the Issue
Experts point to a more complex issue than simple negotiation. Dr. Ross asserts that "what we don’t have is we don’t [have] a free market, and the [drug] negotiations were an attempt at an appearance of free market."
The lack of free market principles is compounded by stringent FDA regulations, as pointed out by Republican politician Vivek Ramaswamy. He contends that the FDA "erects unnecessary barriers" and demands excessive testing for foreign drugs, delaying their entry into the U.S. market and further inflating prices.
These factors, coupled with the lack of robust patent enforcement and price controls, contribute to the high price of drugs.
The situation highlights a concerning trend: despite recent adjustments, American patients are still burdened by outrageously high drug costs, while other nations enjoy access to affordable medications. "It gets to a point where absolutely everything is too expensive," implores Dr. Ross.
‘Where No Price is too High’
Ultimately, experts agree that more needs to be done to address the affordability crisis. Dr. Arzubi suggests more aggressive negotiations and stricter price controls, similar to other developed nations.
"Unfortunately, and for better or for worse, we have a healthcare system and a healthcare mentality in the US, where no price is is too expensive for care," Dr Ross concludes.
It’s clear: while steps have been taken to address fairness and affordability, the fight for equitable drug pricing in America continues.
