NCHC: Drug Pricing Primer

High prescription drug prices contribute to high total health care costs in the United States. Prices in the United States are higher than any other developed country, outpacing the effects of volume, types of drugs, or population size on total drug spending. Retail prescription drugs accounted for 9% of the $3.6 trillion (17.7% of GDP) spent on health care in the U.S. Retail prescription drugs, however, will account for a smaller percentage of total spending as specialty pharmaceuticals and gene or cell therapies, especially those administered by a physician or in the hospital, continue to grow in number and price. Specialty drugs and drugs provided in hospital or outpatient settings are among the most expensive for the system and for consumers. A variety of factors lead to high drug prices in the United States, such as monopolistic pricing, the opaque and complex nature of the system, anti-competitive behavior, and lobbying efforts to prevent an independent system of pricing based on a drug’s value. See the Coalition’s full primer here.