US will still pay, even after negotiating medicine prices, at least twice as much.

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US will still pay, even after negotiating medicine prices, at least twice as much.

US will still pay, even after negotiating medicine prices, at least twice as much.

In conclusion, Medicare's negotiated pricing are especially significant for pharmaceuticals with little competition, meaning that the United States pays higher prescription costs and has priority access to them.
To blend affordability and creativity is the aim.

September 3 (Reuters) - According to a Reuters study, the first-ever prescription medicine costs negotiated by the U.S. government are still, on average, more than twice, and in some cases five times, more than what pharmaceutical companies have agreed to in four other high-income nations.

More than 67 million Americans are covered by the Medicare health plan in the United States, which recently announced higher maximum pricing and opened new tabs for the first ten expensive medications negotiated under the Biden Administration's Inflation Reduction Act.
Medicare has never before made public the true cost of prescription drugs, which are primarily concealed by the intricate U.S. system of rebates and discounts. In 2026, the first year the reduced costs are implemented, Medicare estimates savings of $6 billion.

US will still pay, even after negotiating medicine prices, at least twice as much.

According to a Reuters analysis, other wealthy countries including Australia, Japan, Canada, and Sweden have negotiated much cheaper pricing for the identical medications. These countries' maximum prices are made publicly available.

Medicare would pay $17,581 in 2026 for a 30-day supply of nine of the ten medications, but Sweden will only pay $6,725 for the same amount this year. The tenth medication, Novo Nordisk's (NOVOb.CO) opens new tab insulin Novolog, did not have comparable costs available.

"We have always accepted in the United States that we are the nation that overpays in comparison to other countries," said Stacie Dusetzina, a health policy professor at Vanderbilt University in Nashville.

She stated that the United States finds benefits in being the favored customer, citing the early release of COVID vaccinations as one such benefit.

While many other nations have universal prescription drug coverage based on centralized pricing negotiations with manufacturers, Medicare, the largest government program in the United States, was previously prohibited from doing so by law.
Although Merck (MRK.N) opened a new page stating that it was invalid to compare U.S. prices with foreign generics, Bristol Myers (BMY.N) opened a new tab stating that pricing was country-specific and dependent on national health systems and their regulatory regulations. The other pharmaceutical companies did not reply, and Amgen (AMGN.O), opens new tab, declined to comment.

A representative for the U.S. agency in charge of Medicare stated that although the new law mandates taking into account variables including manufacturer data and the accessibility of substitute medicines, Congress did not include an evaluation of foreign costs in the talks.

US will still pay, even after negotiating medicine prices, at least twice as much.

US PAYS MORE EVERY TIME

Even after estimated reductions, U.S. insurance plans spent more than three times as much, opens new tab, for brand-name drugs, according to a research by the nonprofit RAND Corp. that examined 2022 prescription prices.
Research indicates that the United States' prices are influenced by the quicker adoption of new and more costly medications, whereas other affluent nations that bear the whole cost of healthcare impose stricter regulations on prescription drugs. opens in new tab
Richard Frank, the head of the Brookings Institution's Center on Health Policy, stated that one factor influencing lower foreign drug prices is the American willingness to pay for prescription medications.
It can still be viable to sell more volume to others at lower rates, he noted, "if you have a buyer who is willing to cover some of your ongoing costs in addition to your sunk costs."
There are occasionally less expensive generic or biosimilar equivalents of the original branded medications on the market outside of the United States. For example, Canadian pharmacies have started selling generic versions of Merck's Januvia since late 2022, even though the drug's U.S. patents are valid until 2026.
Prices of name-brand drugs drop dramatically when their patents expire and cheaper alternatives appear on the market. However, pharmaceutical companies can frequently increase the scope of U.S. patent coverage by slightly altering the dosage or formulation, for example.
One of the priciest medications under negotiation, Amgen's Enbrel, which was initially licensed in 1998 for the treatment of rheumatoid arthritis, still has no biosimilar rivals available in the United States. Amgen's patents have been protected by US courts, delaying the release of biosimilars until 2029.
There are already other possibilities in other countries. The cost of a 30-day supply of an Enbrel biosimilar in Sweden is $709, whereas the newly-negotiated price of $2,355 for Medicare applies.
Mariana Socal, an associate scientist at the Johns Hopkins Bloomberg School of Public Health, stated that "the longer a drug is in the U.S. market, the more we pay," pointing out that while prices in other nations usually decrease with time, most drugmakers raise their pricing in the United States each year.
According to a Brookings Institution analysis, Medicare's discussions produced the most benefit for medications with little market competition. opens new tab. Three medications were determined to be responsible for more than half of Medicare's anticipated $6 billion in savings: Enbrel, Johnson & Johnson's (JNJ.N) new tab treatment for Crohn's disease Stelara, and Bristol Myers' and Pfizer's (PFE.N) new tab blood thinner Eliquis.
Other governments have established lower pricing, even for medications for which there is no generic competition outside of the United States.
Medicare has agreed to pay up to $179 for a 30-day supply of AstraZeneca's (AZN.L) new tab diabetic medication, Farxiga. The typical dosage of Farxiga costs $35 maximum in Sweden and approximately $60 in Canada for a 30-day supply.
Medicare, which covers about one-third of all prescription costs in the United States, will be able to negotiate the prices of more medications each year.
"We're going to see the U.S. pushing the market ... so that the U.S. pays something that sort of does a better job of balancing affordability, innovation, and incentives," Brookings' Frank said.