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Author: JoelCairo Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 892  
Subject: Re: Poll--Why Are Drug Costs So High? Date: 4/23/2004 4:56 PM
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Drug costs are growing every year for lots of reasons that have nothing to do with the pharmaceutical manufacturers. Like:

* Aging of the population means more people getting medicated
* Use of multiple medications where single ones were used before
* Higher markups for substituted generics (you pay the co-pay, what do you care if the pharmacits gouges the insurance company?)
* Substituting well-known patented brands for equally effective generics.

There's lots more, but if you think about the supply chain, I'm sure you can come up with some. In Canada, for example, although Pharma prices "at the factory gate" declined 0.2% annually from 1996-2002, drug costs per claim rose at a rate of 7.4% per year (in a Green Shield Canada study.)

Which is just to say: it is really complicated.

Joel
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