LONDON – It’s no secret that American citizens pay the most for drugs, but the extent of the disparity is laid bare in a new index of the prices of 13 medicines in 50 countries worldwide.
For all but one of the 13, the U.S. price is the highest. In the most egregious case, the blood pressure drug Zestril (lisinopril) costs 2,682% more in the U.S. than the median price paid in the 50 countries comprising the index.
Taken overall, the U.S price of the 13 drugs is 306% higher than the median.
The one drug that does not cost most in the U.S. is Prograf (tacrolimus), for preventing transplant rejection, which is most expensive in Saudi Arabia, at 204% more than the median. The U.S. price in comparison, is 86% above the median.
The countries with the lowest prices, Indonesia, Malaysia, Kenya and Thailand, all get their drugs for 90% less than the median, underlining the extent of the disparity from the top to the bottom of the table.
There is a steep drop from the 306% premium in the U.S., to the second ranked country in terms of costliness, Germany, where the percentage deviation from the median is plus 125%. Four other European countries, Italy, Denmark, Spain and the Netherlands, are also in the top 10.
The data have been compiled by Medbelle Ltd., a U.K. startup specializing in applying digital technology to manage all aspects of patient care. While conducting research into how digitalization can improve the quality of health care, it became apparent to the company that one of the biggest causes of inequity of access is the price of drugs.
“There have been multiple studies on the cost of medicine, but never on such as scale as large and as comprehensive as this,” said Daniel Kolb, co-founder and managing director of Medbelle. “We believe in the digitalization of health care, and as such, have made it our mission to increase transparency regarding price and quality.”
Independent researchers commissioned by Medbelle began by selecting 13 pharmaceuticals spanning a variety of common conditions, from heart disease and asthma, to anxiety disorders and diabetes.
The average price of both the brand compound and their generic versions were included, in order to have a complete profile, and the dose is the same in all cases.
That provided the basis for making a pound-for-pound (£) comparison of how much medicines cost in different countries, regardless of whether covered by a health care system, or paid direct from a patient’s own pocket.
As an average of the cost of the branded drug and the generic alternative, the deviation from the median price obscures some curious anomalies. It might be expected that the price of generics is lower, but in the case of seven of the top 10 countries with the highest prices, generics are more expensive than their branded equivalents.
In the United Arab Emirates, which has the third most expensive drugs overall, patients pay an average of 1,021% more than the median for generic versions of the 13 drugs, compared to 75% more for branded drugs.
Similarly, Spain, ranked at seventh most expensive, pays 895% more than the median for generics, but only 32% more for brands.
The reverse is true in the U.S., where prices for generics are 97% higher than the median, while branded drugs are 421% more costly.
“Due to different levels of taxation, transportations costs, purchasing power, levels of income and patents, some price differences across borders are to be expected,” said Kolb. “However, the deviations unveiled by this study are extreme.”
As recent Congressional hearings in the U.S. have shown, there are so many factors involved in drug pricing that the main factors underlying the disparity are hard to pinpoint.
But it is of note that it is only branded medicines that are much more expensive in the U.S., whereas in seven of the 10 countries with the highest prices, it is generics that are priced much higher than the median.
The data seem likely to further stir controversy over drug prices in the U.S. As one case in point, they bring the high price of insulin into even sharper relief.
The study shows Americans pay around five and half times more than the global median for this life-saving drug.
As Kolb put it: “Imagine if an everyday item like milk cost $3.50 in Canada, but $22.85 across the border in the U.S.”
The index also will fuel the political row raging in the U.K., over the possible impact on pharmaceutical pricing of doing a post-Brexit free trade deal with the U.S.
According to U.S. government papers that were made public earlier this year, U.S. trade negotiators are seeking full market access for U.S. pharmaceuticals to the U.K. market. Critics say that could undermine the strict system of price controls the U.K. enforces through centralized negotiations that set the price for the whole of the National Health Service.
The U.K. is ranked 21 out of the 50 countries, with drug prices at a 5% premium to the median. In the case of insulin, the price in the U.K. is 28% less than the median.
While pulling together and analyzing a huge amount of information, there is one serious gap in the data, in that – in common with most of the rest of us – the researchers have no insight into the size of discounts secured in confidential negotiations with payers and reimbursement bodies. The prices shown are said to use “the best available data possible.”
For the U.K., that means the data need to be taken with a largish pinch of salt, because there is a deal between the government and the pharma companies that puts a cap on the amount the NHS spends each year on branded drugs, with the industry giving a rebate if this is breached.