Brand-brand competition is unlikely to reduce list prices of medicines
Greater brand-brand competition alone will likely not lower list prices of brand-name drugs in the US, according to a study published July 30 in the open-access journal PLOS Medicine by Ameet Sarpatwari of Brigham and Women’s Hospital and Harvard Medical School, and colleagues.
US prescription drug spending has increased sharply over the last decade, with higher launch prices of new brand-name drugs and routine price increases on older brand-name drugs. Promoting greater brand-brand competition, which occurs between brand-name drugs indicated for the same condition, has been proposed to address high drug prices. Yet many examples exist of price increases following the introduction of brand-name competition, casting doubt on its effectiveness in the pharmaceutical market. To better understand the economic impact of brand-brand competition, Sarpatwari and colleagues systematically reviewed the peer-reviewed literature for studies of how new drug market entry affects prices of drugs within the same class for patients with the same indications. They searched PubMed and EconLit for original studies on brand-brand competition in the US market published in English between 1990 and April 2019, and found 10 studies evaluating a wide range of drug classes.
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