A-Gs' Drug Recommendations Not Good for Consumers or States

Report Ignores Important Findings, Says NCPA Senior Fellow

DALLAS (June 21, 2005) – A report on the costs and benefits of prescription drugs just released by the National Association of Attorneys General runs the risk of reducing consumers’ choices in the marketplace, especially if states resort to lawsuits against drug manufacturers, according to research recently published by the National Center for Policy Analysis. (see: http://www.ncpathinktank.org/pub/st270/)

“Litigation isn’t the answer,” said NCPA Senior Fellow Devon Herrick. “Prescription drugs are already a good value in America, especially if consumers shop smart.”

Some states already are attempting to reduce prescription drug costs by reimporting drugs from Canada, restricting pharmaceutical marketing and regulating pharmaceutical benefit managers. But, according to Dr. Herrick, the report by the Attorneys-General overlooks some important points:

  • Even though brand name drugs are more expensive in the U.S. than in Canada, American consumers can beat Canadian prices by shopping smart.
  • Even though brand name drugs cost less in Canada, generic drugs are 64 percent more expensive than in the U.S., according to the Fraser Institute.
  • In fact, the U.S. has some of the most inexpensive generic drugs of any developed country.

There also are some points made by one contributor to the Attorneys-General report that bear repeating:

  • Drug therapies are often an inexpensive alternative to more costly doctor therapy and hospital therapy.
  • Per dollar spent, we get a much better return on our drug dollars than on any other category of health care spending.
  • Collective litigation, such as the coordinated suits brought against tobacco companies, runs the risk of reducing consumers’ choices by reducing research and development and interfering with the drug manufacturers’ ability to communicate with consumers.

“Besides, by using shopping techniques common in any market other than health care, consumers can significantly reduce the cost of common drug therapies, sometimes by 90 percent or more,” Herrick added.