Despite the years-long public outcry over high prescription drug prices, public concern has not yet coalesced into major policy change. As a result, Americans remain uncomfortable with pharmaceutical prices, spending, and pharmaceutical manufacturers’ profits.1
In large part, the absence of significant policy change to rein in drug prices or spending is attributable to the inherent political challenges of altering the market of a large, profitable industry. But it also reflects the complexity of the issue of high drug prices. Drug prices can be high or rise quickly for many reasons. The quintessential case is that of the on-patent drug with years of monopoly protection in a market willing (or even required) to pay exorbitant prices through third-party payers. It is precisely this mechanism that underlies the 12% annual growth rate in the launch prices of new cancer drugs, for example.2 But, for other reasons, we have also seen some drugs with competitors, even generics, offered at ever-higher prices.