Prescription Drugs And Managed Care: Can ‘Free-Market Détente’ Hold?

Abstract

The rapid rise in pharmaceutical benefits costs, often cited as a major contributor to the resurgence in health care cost growth, is beginning to strain the relationship between the pharmaceutical and the managed care industries in the United States. In interviews conducted in 1999, executives from both industries maintained a continued preference for a market-based resolution of these tensions. There is evidence, however, that this private-sector détente may give way in the face of the rising business and political pressures that both industries face. Active leadership will be required to prevent deterioration of the prevailing political climate toward economic controls.