Journal Article

Comparing Generic Drug Markets in Europe and the United States: Prices, Volumes, and Spending

McKEE, MARTIN, KANAVOS, PANOS G., WOUTERS, OLIVIER J.

2017

Overview

Context: Rising drug prices are putting pressure on health care budgets. Policymakers are assessing how they can save money through generic drugs. Methods: We compared generic drug prices and market shares in 13 European countries, using data from 2013, to assess the amount of variation that exists between countries. To place these results in context, we reviewed evidence from recent studies on the prices and use of generics in Europe and the United States. We also surveyed peer-reviewed studies, gray literature, and books published since 2000 to (1) outline existing generic drug policies in European countries and the United States; (2) identify ways to increase generic drug use and to promote price competition among generic drug companies; and (3) explore barriers to implementing reform of generic drug policies, using a historical example from the United States as a case study. Findings: The prices and market shares of generics vary widely across Europe. For example, prices charged by manufacturers in Switzerland are, on average, more than 2.5 times those in Germany and more than 6 times those in the United Kingdom, based on the results of a commonly used price index. The proportion of prescriptions filled with generics ranges from 17% in Switzerland to 83% in the United Kingdom. By comparison, the United States has historically had low generic drug prices and high rates of generic drug use (84% in 2013), but has in recent years experienced sharp price increases for some off-patent products. There are policy solutions to address issues in Europe and the United States, such as streamlining the generic drug approval process and requiring generic prescribing and substitution where such policies are not yet in place. The history of substitution laws in the United States provides insights into the economic, political, and cultural issues influencing the adoption of generic drug policies. Conclusions: Governments should apply coherent supply- and demand-side policies in generic drug markets. An immediate priority is to convince more physicians, pharmacists, and patients that generic drugs are bioequivalent to branded products. Special-interest groups continue to obstruct reform in Europe and the United States.

• Publisher: Wiley Subscription Services, Inc,Blackwell Publishing Ltd,John Wiley and Sons Inc
• Subject: Budgets / Case studies / Commerce - economics / Commerce - statistics & numerical data / Companies / Comparative studies / Competition / Constraints / Context / Cost control / Cost Savings - economics / Cost Savings - methods / Drug abuse / Drug policy / Drug prices / Drugs / Drugs, Generic - economics / Europe / Expenditures / Generic drugs / Generic products / Health care / Health care expenditures / Health care policy / health expenditures / Health Expenditures - statistics & numerical data / Health initiatives / Health Policy - economics / Health services / Humans / Interest groups / Market shares / Markets / Money / Original Investigation / Original Investigations / Patients / Pharmaceutical industry / pharmaceutical policies / Pharmacists / Physicians / Policy making / Practitioner patient relationship / Prescribing / Prescription drugs / Price indexes / Prices / Pricing / Pricing policies / Reforms / Regulators / Savings / Streamlining / Supply & demand / United States