Foreign Free Riders and the High Price of U.S. Medicines
BMJ 2005; 331; 958-960
4 Pages Posted: 18 May 2013
Date Written: Oct 22, 2005
The United States government is running a campaign to characterize other industrialized countries as free riding on high U.S. pharmaceutical prices and innovation in new drugs. The campaign is based on the argument that lower prices imposed by price controls in these countries do not pay for research and development costs. Companies allege that Americans have to pay the research costs through higher prices in order to keep supplying the world with new drugs. We can find no evidence to support these and related claims, and we present evidence to the contrary. We also explain why the claims themselves contradict the economic nature of the pharmaceutical industry.
Keywords: health economics, pharmaceutical prices, affordable drugs
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