GDP Blog

2019 Drug Prices = A Bitter Pill to Swallow

Posted by Seth Denson

Jan 3, 2019 5:20:32 PM

It was reported this past week that more than two-dozen drug manufacturers are planning to raise the list price of many of their products in early 2019. On the surface this seems to be a delayed ‘slap in the face’ at President Trump who has made lowering the cost of drugs a primary objective. Many of these same manufacturers had announced back in mid-2018 that they had intended to raise prices; however, following public shaming from the White House later relented, stating that they would delay those rate hikes until 2019, and now it appears that those chickens have come home to roost.

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Topics: prescription drugs, Cure for Healthcare, Trump

The President's Plan to Curb Rising Prescription Drug Costs: What Was Said, What Wasn't Said, and What Needs to Be SAid

Posted by Seth Denson

Feb 13, 2018 1:24:18 PM

Late last week, The Council of Economic Advisers which operates within the Executive Office of the President released a nearly 30 page white paper outlining issues related to the ongoing increase in costs associatePresidental White Paper-1.pngd with pharmaceutical drugs.  The report was broken into multiple parts, ranging from introducing this issue, describing how Americans are paying higher prices for prescription drugs than the rest of the developed world, and finally how we might improve innovation to reduce the overall price of healthcare.  Within the sub-parts of the document were topics including how Medicaid and Medicare procure prescriptions for their participants, how other world markets are benefiting from the U.S. led innovation and development, how middle-men known as Prescription Benefit Managers are inflating the overall cost of prescriptions, and the lengthy process by which drugs become available in the marketplace. 

SUMMARY & COMMENTARY

While the original intent of the White Paper was to both outline problems and offer up solutions, the document favored the former, and provided little by way of real policies that might impact the rising cost of prescription drugs.  We agree with the information provided in the brief; however it fell short in the areas of solutions only offering few suggestions limited in substance.  Healthcare is a real problem in the United States making up 18% of the Gross Domestic Product.  Of the $3.4 trillion spent on healthcare each year in the United States, roughly 20% of that number, $457 billion, is on prescription drugs.  Said differently, for every $100 generated in the United States, $2.50 is spent on prescriptions. 

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Topics: healthcare reform, Republican Healthcare, prescription drugs, iamthelorax

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