THE DETERMINANTS OF PRICING IN PHARMACEUTICALS: ARE US PRICES REALLY SO HIGH?
Article first published online: 10 JAN 2013
Copyright © 2013 John Wiley & Sons, Ltd.
Volume 22, Issue 11, pages 1377–1397, November 2013
How to Cite
Cabrales, A. and Jiménez-Martín, S. (2013), THE DETERMINANTS OF PRICING IN PHARMACEUTICALS: ARE US PRICES REALLY SO HIGH?. Health Econ., 22: 1377–1397. doi: 10.1002/hec.2887
- Issue published online: 16 OCT 2013
- Article first published online: 10 JAN 2013
- Manuscript Accepted: 23 OCT 2012
- Manuscript Revised: 5 JUL 2012
- Manuscript Received: 19 JUN 2011
- pharmaceutical prices;
This paper studies price determination in pharmaceutical markets using data for 25 countries, 6 years, and a comprehensive list of products from the MIDAS IMS database. A key finding is that the USA has prices that are not significantly higher than those of countries with similar income levels, especially those that are ‘lightly regulated’. More importantly, price differences to the US levels increase for ‘branded’, world top selling, or innovative products, and decrease, regardless of the level of regulation for mature or widely diffused molecules. Because prices for top selling molecules may be easier to perceive and recollect and more important for companies, they may bias the public discussion about international price differences. Copyright © 2013 John Wiley & Sons, Ltd.