Most price comparisons that find drug prices much higher in the United States than other parts of the world are flawed, say researchers Patricia Danzon and Michael Furukawa. Their research found that U.S.-foreign price differentials are roughly in line with income and are smaller for drugs than for other medical services.
Most studies exclude all generic drugs and limit their analyses to a few widely used brand-name drugs, even though generics now account for roughly half of the unit volume in the United States. This makes drug prices appear much higher in the United States than in other countries.
Based on a comprehensive comparison of drug prices in eight developed countries, Danzon and Furukawa found that:
The authors indicate that pharmaceutical markets differ greatly across countries, in range of compounds, presentations, use, generic shares and the number and type of manufacturers. Consequently, no single perfect price comparison is feasible.
Source: Patricia Danzon and Michael Furukawa, Prices and Availability of Pharmaceuticals: Evidence from Nine Countries, Health Affairs- Web Exclusive, October 29, 2003.
For text http://content.healthaffairs.org/cgi/reprint/hlthaff.w3.521v1.pdf
For more on Brand Name Drugs vs. Generics http://www.ncpa.org/iss/hea/
FMF Policy Bulletin\18 November 2003
