# Why are drugs so expensive in the USA? **URL:** \ **Category:** Factual Questions\ **Created:** [December 21, 2014, 3:33am UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799 "2014-12-21T03:33:38Z")\ **Posts on this page:** 7\ **Page:** 2
**Author:** ![clairobscur](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clairobscur](https://boards.straightdope.com/u/clairobscur)\ **Post date:** [December 22, 2014, 3:05pm UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/21 "2014-12-22T15:05:20Z")
> [@grude](#): > > Is it usual for government to negotiate prices for drugs even sold at private pharmacies? I assumed taxpayer supported healthcare AKA public hospitals negotiate for drugs provided by them at in house pharmacy, but outside private pharmacies buy the drugs on the market like anyone else? > . Prices are negociated at the national level, since they’re ultimately paid for at the national level (for instance, the healthcare system reimburses you for the drugs you bought at the private pharmacy). So, whatever governmental agency is in charge negociates with the pharmaceutical company a price that will apply for all buyers (public hospitals as well as private pharmacies). ---
**Author:** ![clairobscur](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clairobscur](https://boards.straightdope.com/u/clairobscur)\ **Post date:** [December 22, 2014, 3:12pm UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/22 "2014-12-22T15:12:16Z")
> [@usedtobe](#): > > July 14, 2014 – An investigation into the pricing of the hepatitis C drug Sovaldi has been launched by the U.S. Senate Finance Committee. The drug – made by Gilead Sciences Inc. – costs about $1,000 a pill, or about $84,000 for a patient on a standard, 12-week treatment schedule, the Wall Street Journal reported. > **(end Google)** > > As I recall the conversation, it went something like: > “Why so expensive?” > “Because we can make people pay it”. > > IOW: Pay us $84K or enjoy your Hep C Now that you mention it, the more efficient drug I was refering to in my previous post re negociations between France and a pharmaceutical company (priced on the basis of making it more costly than previous drugs) is for hepatitis, so probably the same one. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 22, 2014, 4:54pm UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/23 "2014-12-22T16:54:50Z")
> [@Wesley\_Clark](#): > > non-scheduled Rx drugs can be bought from Mexico, I believe it is legal to import a 90 day supply of a non-scheduled drug w/o an Rx. And the prices are much higher than the $4 list at domestic pharmacies. So I don’t know if this is the case. Well that’s interesting. But I’m confused as to why people are going to Mexico to buy drugs at a higher price. Assuming it’s because they can get them without a prescription then maybe it’s just that Mexico is serving the same role as another privileged provider because not many people can easily go there to get them. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 22, 2014, 4:56pm UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/24 "2014-12-22T16:56:23Z")
> [@clairobscur](#): > > This could only work for generic drugs, for which there are multiple producers. That’s true, and of course where there is sufficient demand. ---
**Author:** ![Yllaria](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/yllaria/32/3452_2.png) [@Yllaria](https://boards.straightdope.com/u/Yllaria)\ **Post date:** [December 22, 2014, 7:48pm UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/25 "2014-12-22T19:48:28Z")
> [@jtur88](#): > > One reason for the high cost is the resisance to gain by economy of scale. There is a manpower cost to dispensing tiny quantities of drugs at high frequency. Insurers refuse to pay for more than one month at a time, so it is necessary to keep running back to the pharmacist and make him keep doing his job over and over again. . . . Actually, my insurance encourages 90 day refills for “maintenance medication”. The copay for 90 days is only twice what the copay is for 30. For one year, HR contracted with a company that required 90 day refills and that they arrive by mail. Unfortunately, the mail order fulfillment sucked dead donkey balls and there was an uproar over late medication, missing medication, and double billing. Now we’ve just got the incentive and can get it filled in person. I’m much happier with that. ---
**Author:** ![Spectre\_of\_Pithecanthropus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/spectre_of_pithecanthropus/32/12343_2.png) [@Spectre\_of\_Pithecanthropus](https://boards.straightdope.com/u/Spectre_of_Pithecanthropus)\ **Post date:** [December 29, 2014, 2:36am UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/26 "2014-12-29T02:36:31Z")
> [@TriPolar](#): > > There are a lot of direct factors that have been covered here, but a basic reason is that drugs are illegal to sell. Even the prescription drugs that are the topic of this thread can only be sold by a privileged group. This destroys the normal market forces that drive pricing. Eliminate the regulations and prices will plummet. However, there may be some side effects from a change like that. Why would this be a factor in comparative drug pricing? Retail drug sales are heavily regulated everywhere. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 29, 2014, 2:48am UTC](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799/27 "2014-12-29T02:48:26Z")
> [@Spectre\_of\_Pithecanthropus](#): > > Why would this be a factor in comparative drug pricing? Retail drug sales are heavily regulated everywhere. The regulations limit demand. Drug manufacturers can’t do much to increase demand with lower prices. [Previous page](https://boards.straightdope.com/t/why-are-drugs-so-expensive-in-the-usa/707799.md?page=1)