US Drug Prices "Twice As High As Europe"

Drugmakers typically charge twice as much for their products in the USAas they do in Europe, says a new study from Datamonitor, available through the Marketletter's offices, which compares ex-manufacturer prices of the 150 best-selling drugs by 1995 sales in the USA, Germany, France, Italy and the UK.

Price differences are smaller for newer drugs than older ones. For drugs launched before 1980, the US price is 130% higher than the estimated pan-European prices, but the difference drops to an average of 70% for drugs launched after 1990.

Datamonitor discounts the role of exchange rate fluctuations and generic competition on older drugs in the reduction of US to European differentials over time. Instead, it says the driving force is the narrowing of country-to-country launch prices. It says the study backs the view that global price bands are slowly narrowing, although a single global price is unlikely for most drugs in the near future.