RAND Finds Unbranded Generics Cheaper In The U.S. Than In 32 Other Countries.

Generics as a whole comprise 85% of volume of medicine dispensed in US.

Shabbir Imber Safdar is the Executive Director of the Partnership for Safe Medicines.

In 2019, the U.S. Health and Human Services Agency hired the RAND Corporation to do a study comparing drug prices around the world to U.S. prices. Getting accurate prices for medicine in the U.S. is a real challenge, because the published "list price" is not the actual price a health insurance company pays for medication.

What insurers actually pay is the price they negotiate minus the rebate they get from a manufacturer—and a lot of that is never made public.

So from the start that's a problematic way to conduct research. The RAND Corporation  noted that in the study, and then did the project anyway, which makes it kind of worthless.

They did, however, do a decent piece of research into costs of unbranded generics.

Unbranded generics make up 85% of the medicine dispensed in the U.S., so it's a big part of our cost equation. What RAND found was that we pay 16% less than other countries in the OECD for unbranded generics.

Shouldn't that be big news?  Shouldn't U.S. politicians be trying to figure out how to make the U.S. generics market as healthy as possible?

You'd think so, but not according to RAND. They barely mention that as an interesting policy result. Download the RAND report from their site to see for yourself.

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