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Tuesday, December 22nd, 2015

Why medicine costs so much in America

Author:     Julia Belluz
Source:     Vox
Publication Date:     December 18, 2015, 10:40 a.m. ET
Link: Why medicine costs so much in America
Stephan:   Americans pay orders of magnitude more for the same drugs than people in any other country. The difference is so great that if you have ever bought a drug with which you are familiar in Europe, Canada, Latin America, or Asia you will be stunned at the difference. Why do drugs in the U.S. cost more than anywhere else on Earth? Big Pharma's propaganda machine aided and abetted by corporate media spews out the line that the higher cost covers research and development. Study after study, however, has shown this is just an out and out lie. Here is a good assessment as to the true answer.
Credit: Shutterstock

Credit: Shutterstock

America’s soaring drug prices are suddenly getting lots of attention. For that, you can thank Martin Shkreli, the much-loathed CEO of Turing Pharmaceuticals who recently raised the price of an anti-parasitic drug by 5,500 percent. Overnight, a single tablet went from $13.50 to $750, making an essential medicine unreachable for some.

Many people have wondered how Shkreli could do something like this. But to understand that story, you first have to understand how the US system of drug pricing actually works — and why it’s so wildly different from other countries.

1) In the United States, drug prices are set by the market — unlike elsewhere

In other countries with single-payer systems, governments exert much more influence over the entire health care process. That allows them to negotiate directly with drugmakers. The government sets a maximum price that it will pay for a drug, and if the company doesn’t agree, it simply loses out on the entire market. This puts drugmakers at a disadvantage, driving down the price […]

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