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Expenditure On Retail Pharmaceuticals Per Capita, 2017 (USD$ PPP)
Prescribed Medicines: $1024
Over-The-Counter Medicines: $197
Medical Non-Durable: $
Total: $1220
Source: OECD (2019), Health at a Glance 2019: OECD Indicators, OECD Publishing, Paris, doi.org/10.1787/4dd50c09-en.
Expenditure On Retail Pharmaceuticals By Type Of Financing, 2017 (%)
Government/Compulsory Plans: 73%
Voluntary Health Insurance Plans: 0%
Out-Of-Pocket: 27%
Other: 0%
Source: OECD (2019), Health at a Glance 2019: OECD Indicators, OECD Publishing, Paris, https://doi.org/10.1787/4dd50c09-en.
“CMS [Centers for Medicare and Medicaid Services] estimates retail spending on prescription drugs at 9.2% of NHE [National Health Expenditures] in 2018 and projects that this share will fall to 9.0% by 2028. We estimate that nonretail drug spending accounted for an additional 4.5% of NHE in 2018, growing to 4.9% by 2028. Total drug spending will grow from 13.7% to 13.9% of NHE, from about $500 billion in 2018 to $863 billion in 2028. The retail component is projected to grow from $335 billion to $560 billion and the nonretail component from $165 billion to $302 billion.
“These projections do not reflect coronavirus disease 2019 (COVID-19) effects. Estimates through October 2020 indicate sustained retail drug spending growth with spending on health care services falling sharply and recovering slowly. Accordingly, our projection of nonretail drug spending in 2020 is likely overstated, as much of the nonretail drug growth occurs in clinic settings inhibited by the pandemic.5 It is too soon to know whether permanent COVID-19–related changes will affect the 10-year projections.”
Source: Rena M. Conti, Ani Turner, Paul Hughes-Cromwick. Projections of US Prescription Drug Spending and Key Policy Implications. JAMA Health Forum 2(1):e201613 (2021) dx.doi.org/10.1001/jamahealthforum.2020.1613
“The U.S. spent $457 billion in 2016 on combined retail (dispensed at the pharmacy) and non-retail (dispensed in physician offices) drugs.26 27 Medicare alone spent nearly $130 billion on prescription drugs that year, $99.5 billion of which was for Part D pharmacy drugs and $29.1 billion of which was for Part B physician-administered drugs.28 In total, 30 percent of Medicare spending went to prescription drug costs in 2016.29 As Figure 1 shows, U.S. spending on prescription drugs has been rising precipitously during the time that Medicare has been paying for drugs under Part D. Projections indicate this spending will only continue to increase.
“There is a direct and positive relationship between the cost of drugs and drug spending. Between 2012 and 2016, drug spending grew by 27 percent for individuals with employer-sponsored health insurance; at the same time, drug prices increased by almost 25 percent (and utilization only increased by about two percent during that time).31
“The introduction of new types of drugs into the market is one driving factor of these increases in spending. For example, in 2014 and 2015, prescription drug spending increased rapidly because of the new high-cost hepatitis C drugs that came to market.32 Drugs are most expensive when they are first introduced to market, before there is competition of other drugs in their class, and before the original patent expires and generics become available.33“
Source: “A Painful Pill To Swallow: US vs International Prescription Drug Prices,” US House Ways and Means Committee, Sept. 2019.
“The U.S. pays the most for drugs, though prices varied widely. Across the 79 drugs in our sample, the average list price per dose was $152.92, ranging from $0.086 to $16,597.7 Annual pharmaceutical spending per capita varied from $318 in Denmark to $1,220 in the United States. Average annual per capita spending on pharmaceuticals was $675.25 across the 12 countries, $625.73 excluding the U.S. U.S. drug prices are on average outliers relative to all comparator countries. Most countries had average drug prices around 24 to 30 percent of those in the United States. The greatest disparity was with Japan, where the average drug price was only 15 percent that of the U.S., meaning that the U.S. on average spends seven times what Japan pays for the same drugs. Denmark represented the closest average price, where average drug prices were 39.1 percent of the average U.S. drug price.”
Source: “A Painful Pill To Swallow: US vs International Prescription Drug Prices,” US House Ways and Means Committee, Sept. 2019.
“U.S. drug prices were nearly four times higher than average prices compared to similar countries. We found that individual drug prices in the U.S. ranged from 708 to 4,833 percent9 higher than the combined mean price in the other 11 countries. On average, U.S. drug prices were 3.7 times higher than the combined average of the other 11 countries in the study.”
Source: “A Painful Pill To Swallow: US vs International Prescription Drug Prices,” US House Ways and Means Committee, Sept. 2019.
“U.S. consumers pay significantly more for drugs than in other nations, even when accounting for rebates. One of the major arguments from the pharmaceutical industry justifying these international price differentials is that while list prices are much higher in the U.S., the rebates offered are also significantly higher, so the net price is comparable. To test this claim, we compared rebate rates in the U.S. to Germany and found German rebate rates are relatively low compared to U.S. rebates, ranging from 0 to 35 percent and averaging 8.7 percent. U.S. rebates would need to average 67 percent to match average German net prices, and the average U.S. rebate rate would need to be about 73.3 percent in order for U.S. net prices to match list prices in the other 11 countries in the study. According to the Congressional Budget Office (CBO) the average rebate rate for band [sic] name drugs was 22 percent in 2015.10“
Source: “A Painful Pill To Swallow: US vs International Prescription Drug Prices,” US House Ways and Means Committee, Sept. 2019.
Health Systems Facts is a project of the Real Reporting Foundation. We provide reliable statistics and other data from authoritative sources regarding health systems in the US and several other nations.
Page last updated March 16, 2021 by Doug McVay, Editor.
