Drug prices continue to be around three times higher in the US than other wealthy nations

The Assistant Secretary for Planning and Evaluation or ASPE, a government research agency, released a report showing that US drug prices–brand name and generic–are almost 2.78 times the price in 33 other wealthy countries. Even for people with Medicare Part D prescription drug benefits, drug costs can be high. That will only change when the US negotiates prices for all drugs as every other wealthy nation does for its residents.

ASPE hired RAND Health Care to conduct the analysis. When RAND compared brand-name drug prices in the US to prices in OECD countries, it found that they were more than 3.20 higher even after adjusting for rebates. It also found that the preponderance of new drugs were first available in the US.

The US is responsible for a disproportionate and ever larger share of total spending on new drugs as compared with other wealthy nations. The Inflation Reduction Act gave Medicare the ability to negotiate the price of several dozen drugs, beginning with 10 drugs in 2025. But, there are thousands of drugs on the market and working people do not benefit from Medicare’s negotiated prices.

The price of drugs is rising faster in the US than in other wealthy countries. If you do not factor in rebates, which insurers usually pocket, we pay more than four times the price of people in other wealthy countries for our drugs.

We pay about two-thirds less for generic drugs than people in other wealthy countries. And, these drugs represent 90 percent of US spending on prescription drugs. These drugs only represent about 41 percent of spending on prescription drugs in other countries.

Some drugs are particularly expensive in the US. For example, insulin prices are almost ten times higher in the US than in other wealthy countries. We pay more than 10 times what people in France and the UK pay for insulin. We pay six times more than Canadians for insulin. Rebates for people with insurance and people who have met their deductible bring the price of insulin down to 2.33 times what people pay in other wealthy countries.

While most new drugs launch first in the US, a large number of them launch in other wealthy nations soon after. The researchers found that the drugs that are most beneficial are available in all wealthy countries within a short time.

Here’s more from Just Care:

• Facts about prescription drug prices in the U.S.
• Case study: Costco saves one couple hundreds of dollars over Medicare Part D
• 2024: Medicare Part D coverage and costs
• Some Medicare prescription drug plans dropping insulin coverage
• Millions safely import low-cost drugs from abroad