[Ip-health] Comparison of U.S. and International Prices for Top Medicare Part B Drugs by Total Expenditures

Aidan Hollis ahollis at ucalgary.ca
Thu Oct 25 11:32:31 PDT 2018


"In other countries, there may be additional rebates and value-based agreements that are not captured in the ex-manufacturer price. Similarly, the U.S. ex-manufacturer prices do not include potential rebates and after sale discounts. To the extent that these impacts differ by country, our results will be biased.”

The rebate thing is important. See, for example in the US, https://www.fiercepharma.com/pharma/lilly-s-average-rebates-and-discounts-swell-to-50-off-list-prices
which states that rebates are on the order of 50% in the US. And they are very large on these products in other countries too, particularly where large (state) insurers are present.

Given that confidential rebates may be 0, 20%, 50% or 80%, it is hard to know what to make of price comparisons that don’t account for rebates.



Aidan Hollis
Professor of Economics
University of Calgary
ahollis at ucalgary.ca<mailto:ahollis at ucalgary.ca>
+1 403 220 5861

http://econ.ucalgary.ca/profiles/aidan-hollis

Incentives for Global Health
http://www.healthimpactfund.org

On Oct 25, 2018, at 11:56 AM, James Love <james.love at keionline.org<mailto:james.love at keionline.org>> wrote:

This is the new international reference pricing report from HHS.

https://aspe.hhs.gov/system/files/pdf/259996/ComparisonUSInternationalPricesTopSpendingPartBDrugs.pdf

But if you read the report, the data does not jive with some of the
messaging on the Trump speech.

Table 4 of this report presents one set of numbers of cost savings from
international reference pricing, including $8 billion for one year of
Medicare Part B spending on 20 (or is it  29?)  products.

But news reports are that Trump is proposing policies that will saving $17
billion, OVER FIVE YEARS.

So, we will have to look carefully at the details.

Speech  at 2pm.


Jamie
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