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Comparing generic drug markets in Europe and the United States: prices, volumes, and spending

Wouters, Olivier J., Kanavos, Panos G. and McKee, Martin (2017) Comparing generic drug markets in Europe and the United States: prices, volumes, and spending. Milbank Quarterly, 95 (3). pp. 554-601. ISSN 0887-378X

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Identification Number: 10.1111/1468-0009.12279

Abstract

Context: Rising drug prices are putting pressure on health-care budgets. Policymakers are assessing how they can save money through generics. 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 U.S. We also surveyed peer-reviewed studies, academic books, and grey literature published since 2000 to: (1) outline existing generic drug policies in European countries and the U.S., (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 historical examples from the U.S. 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 six times those in the U.K. The proportion of prescriptions filled with generics ranges from 17% in Switzerland to 83% in the U.K. By comparison, the U.S. 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 U.S., 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 U.S. 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 persuade more physicians, pharmacists, and patients that generic drugs are bioequivalent to branded products. Special-interest groups continue to obstruct reform in the U.S. and Europe.

Item Type: Article
Official URL: http://onlinelibrary.wiley.com/journal/10.1111/(IS...
Additional Information: © 2017 The Authors © CC BY 4.0
Divisions: LSE Health
Subjects: R Medicine > RA Public aspects of medicine > RA0421 Public health. Hygiene. Preventive Medicine
R Medicine > RM Therapeutics. Pharmacology
Sets: Research centres and groups > LSE Health
Research centres and groups > LSE Enterprise
Date Deposited: 30 Mar 2017 10:31
Last Modified: 20 Apr 2019 01:44
URI: http://eprints.lse.ac.uk/id/eprint/71641

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