How price indices are used to compare prescription drug prices between countries.
The United States has the world's highest drug prices, by far.
Although several prior studies have systematically compared drug prices in the U.S. with those in other countries, the most recent of these studies use data that is almost a decade old. Researchers at RAND used 2018 prescription drug volume and price data (IQVIA MIDAS ) to compare American drug prices with those in 32 other OECD nations, both overall and for specific categories of drugs, such as brand-name and generic medications.
The research was based on manufacturer prices due to availability of comparable data for all countries.
After analyzing all prescription drugs available across the 33 markets, the report found that U.S. prices for drugs in 2018 were 256 percent of those in the 32 OECD comparison countries - combined.
The study calculated price indices - greater than 100 indicate that U.S. prices are higher than those in the comparison country; indexes less than 100 indicate that U.S. prices are lower than those in the comparison country. For example, U.S. prices were 218 percent of prices in Canada (or, alternatively, Canadian prices were 54 percent less).
Brand-name drugs drove the disparity: U.S. prices for this category were 344 percent higher. For unbranded generics, U.S. prices were lower than those of other countries - specifically, 84 percent of prices in the comparison countries combined.
Among the G7 nations, the United Kingdom, France and Italy generally had the lowest prescription drug prices, whereas Canada, Germany and Japan tended to have higher prices.
Bottomline, recent policy proposals that rely on using prices in other countries as a tool to control prices in the U.S. just might work. However, there are many factors to consider when developing and implementing said policies.