60Years after Kefauver: Household income required to buy prescription drugs in the United States and abroad.

Abstract

Assessing drug prices relative to income in the US compared to other Organization for Economic Co-Operation and Development (OECD) countries provides context for policymakers seeking to improve access and affordability. Using current drug p. rice and income data, we recreate a historical analysis presented in 1960 to the Senate Subcommittee on Antitrust and Monopoly led by Sen. Estes Kefauver. We identified frequently prescribed generic and brand name drugs for US and international comparison by drug price category (low-price generics, mid-price brands, and high-price specialty brands) as a function of income. We further extend our analysis to consider US prices relative to the current Federal Poverty Level (FPL). For the low-price drugs, all fell below 1% of all of the US income levels presented. Mid-price drugs were below 10% of income for those at the US median household income level but approached 30% of income for those at the FPL. High-price drugs varied greatly, reaching over 600% FPL for one product. Americans receive bargain prices on par with international comparators for many low-priced generics drugs. For commonly used mid-priced drugs or high-priced specialty products, whether or not drug prices are considered a bargain in the US compared to international markets may depend on individual income. External reference pricing policies may help inform the negotiation for some drug prices, but affordability may still be limited for lower wage earners.