The Global Drug Price Gap: Why Americans Pay More for Life-Saving Medicine

The American prescription drug costs are so bad that Americans often cross international borders to afford their drugs. In all other westernized countries, not only do they have free healthcare, but they also have prescription drugs that are standardized or subsidized, often costing less than $20 a bottle. PBS Frontline does a story called The Other War on Drugs, which portrays senior citizens taking weekly trips over the U.S. border into Canada so that they can afford their prescription medications. Almost all westernized nations outside the United States have (at the very least) price controls for their drugs. 1 However, because of Big Pharma's presence in the U.S. through lobbyists, the cost of prescription medication remains outrageously expensive.

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Prescription drugs are not a recreational luxury; they are a product that keeps people alive. But just like the rest of the American health-care model, it forces Americans to put a price on their body, health, and well-being. 

Drug companies argue that enforcing price controls would put a cap on innovation. Indeed, innovation, research, and development are long, lengthy, and expensive processes. One has to develop the drug, test it on animals (such as lab rats), and then 3 phases of human testing (which is the most expensive part of the testing). 3 in every 10 drugs make their money back. It is a high-risk business, so investors expect a lot back for their investment. However, they often make it sound like they are just scraping by. The pharmaceutical drug trade is a huge industry with staggering profits!

According to independent research, pharmaceutical companies spend 16% of the price of a drug on marketing, which is more than research and development. Like alcohol commercials that do not state reasons to buy their product (such as flavor or quality) but rather, self-definition (i.e., it makes a personal statement about "who I am" or the lifestyle you live). Prescription drug commercials play to a perverse image of what it means to take the specific drug. The commercials depict individuals living healthy, vibrant lives thanks to pharmaceuticals. The medical condition in which the drug is supposed to help, and the human suffering that coincides, is not depicted. 

The corporations that make up the pharmaceutical industry are among the largest in the world. Those companies include Pfizer, Johnson & Johnson, Novartis, Procter & Gamble, and Merck. These companies are often collectively referred to as Big Pharma. In 2004, their combined sales were $550 Billion with Pfizer and Johnson & Johnson leading with $40 billion or more in sales each. 2 

1. The Other Drug War. Frontline, PBS. 2003. 

2. Big Bucks Big Pharma: Marketing Disease & Pushing Drugs (DVD). Goodman, Amy. Media Education Foundation.

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