U.S. Prescription Drug Costs Up to 4 Times Higher Than Other Countries, Studies Show

Americans are paying exorbitantly high prices for prescription medications compared to other nations, according to President Joe Biden’s recent statements and multiple independent analyses.

During a February campaign event in California, Biden claimed that drug prices in the U.S. are 40-60% higher than in places like Canada, the U.K., and Brazil. Fact-checkers at WLRN/PolitiFact affirmed Biden’s remarks as “mostly true,” citing mounting evidence of the stark price disparities.

The 2022 Inflation Reduction Act aims to address the issue by allowing Medicare to negotiate drug prices directly with manufacturers and capping out-of-pocket costs for seniors. However, the root causes behind America’s elevated drug spending remain complex.

A RAND Corporation study revealed that in 2022, U.S. drug prices across all medications were 2.78 times higher on average than in 33 other countries. For brand-name drugs specifically, prices were a staggering 4.22 times higher, with the gap remaining over 3 times after factoring in discounts and rebates.

Multiple politicians and government reports have sounded the alarm on surging U.S. drug costs in recent years. Sen. Bernie Sanders released an analysis showing Americans often pay nearly 10 times more than Germans for lifesaving treatments. The report criticized major pharmaceutical companies for allocating more funds to executive compensation and stock buybacks than research and development.

With public and legislative pressure mounting, the bipartisan Modernizing and Ensuring PBM Accountability (MEPA) Act seeks to remove incentives for pharmacy benefit managers to prioritize higher-priced drugs over cheaper alternatives.

As the debates over fair drug pricing rage on, the data indicates Americans continue to bear a disproportionately heavy cost burden compared to peer nations worldwide.