The Politics of the International Pricing of Prescription Drugs

The Politics of the International Pricing of Prescription Drugs

The Politics of the International Pricing of Prescription Drugs

The Politics of the International Pricing of Prescription Drugs

Synopsis

Harrison analyzes how the U. S. research pharmaceutical industry, faced with domestic political opposition to the prices it charged for prescription drugs, chose to pursue its policy goal of greater appropriability of its intellectual property through the institutions of foreign economic policymaking.

Excerpt

A. INTRODUCTION

Former president Bill Clinton argued that [no American should be forced to get on a bus to Canada] in order to obtain prescription drugs at lower prices. To most of the listening public, the president's message was clear: prescription drug prices are too high in the United States and need to be lowered. Ironically, to one segment of the population the president's message spoke of their own agenda: raise the price of prescription drugs in Canada. Either option would create the same result: no more Americans going to Canada to buy prescription drugs. However, the public policy behind each option could hardly be more different. This book tells the story of how that one segment, the U.S. research pharmaceutical industry, shaped U.S. and global public policy toward that latter option.

B. THE STORY BEGINS: THE U.S. PHARMACEUTICAL MARKET

Selling drugs is big business, and there is no better place to sell them than in the United States (Table 1.1). The world pharmaceutical market in 1998 was worth $302 billion. The United States' pharmaceutical market, the world's largest single market, is estimated to be $90 billion. In addition, the United States is home to many of the world's biggest drug companies. Five of the top ten and three of the top four biggest sellers are headquartered in the United States. Of the top-selling U.S.-based pharmaceutical companies, U.S. drug purchases account for more than 60 percent of total sales.

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