Monday, December 03, 2007

Fraser: US Drug Policies Produce Better Outcomes

From a new study by Canada's Fraser Institute (news release here, full report here) titled "Cost Burden of Prescription Drug Spending in Canada and the United States":

Even though Canadian prices for brand name drugs are lower than U.S. prices for identical drugs (by 51% on average), consumers in both countries spend roughly the same percentage of their personal income on drugs because the price of Canadian generics is more than double U.S. prices for identical drugs (115% more expensive).

The root causes of high generic drug prices in Canada are government policies that shield retail pharmacies and generic drug manufacturers from competitive market forces that would naturally put downward pressure on generic drug prices.



At 12/03/2007 9:51 AM, Anonymous Anonymous said...

Now there you go cherry picking again Mark.

The Canadian health care system with all of its defects still produces nearly the same end results as we do here at nearly half the price.

No one in Canada ever declares bankruptcy because of Doctor or hospital bills like they do here in the U.S.

At 12/03/2007 10:25 AM, Anonymous Anonymous said...

No one in North Korea goes bankrupt from medical bills. either. What's your cherry picking point?

At 12/03/2007 11:56 AM, Blogger spencer said...

The original study for the data comparing US and Canadian generic drug prices uses wholesale prices for the US and retail prices for Canada.

I have no idea how this biases the results but in general in the US retailers follow a rule of doubling the wholesale price to get their retail price.

This rule of thumb would essentially eliminate the US-Canadian price difference.

Do you have any evidence that this rule of thumb is misleading?

At 12/03/2007 12:00 PM, Blogger spencer said...

The original source is here:

At 12/03/2007 12:40 PM, Anonymous Anonymous said...

Anonymous 10:25 AM I was defending the Canadian health care system as a whole and not cherry picking bad parts of it.

Reliable research published in peer reviewed respected publications shows that the American and Canadian systems of health care produce nearly identical results over time.

The U.S. system scores slightly better than Canada in immediate care and Canada scores slightly better than the U.S. in longer term care.

Also, I don't know what your education level is so forgive me if you are still in grade school but Canada and North Korea are two entirely different kinds of countries. You really should spend a little time learning about your neighbor to the north.

At 12/03/2007 12:42 PM, Anonymous Anonymous said...

Spencer where do you find that information regarding wholesale pricing for the U.S. and retail pricing for Canada?

At 12/03/2007 1:17 PM, Blogger VH said...

Anonymous: It's too bad the Canadian Supreme court doesn't agree with you.: In a landmark case several years ago, the Supreme Court of Canada decided to strike down two major Quebec laws that banned private health insurance. The court came to the conclusion that the health system did not serve Canadians fairly or properly. I will also remind you that Canadians get so frustrated with waiting for rationed care that they cross over to the U.S. to get treated; They spend about $1 billion a year getting U.S. medical care. The Canadian system isn't the nirvana that single-payer parrots like you beleive it is.

At 12/03/2007 5:23 PM, Blogger bob wright said...

Why should we totally overturn the U.S. system if only to produce basically similar outcomes?

That would be a lot of time and expense for nothing.

Oh wait. I forgot. A lot of people would get to feel good because they did something.

At 12/03/2007 8:38 PM, Anonymous Anonymous said...

Anonymouses (Anonymice?) -- I do wish you would identify yourselves in some way. Sometimes it's difficult to follow a train of thought when there is more than one 'anonymous' posting.

At 12/04/2007 1:00 PM, Anonymous Anonymous said...


I have no problem with competition. The Canadian Supreme Court decision didn't say that Canada's health care system was worse than our system here in the U.S. it just said that Canadians should be able to have another option. Up until that court decision Canadian doctors could not set up private clinics and charge more to individuals--now they can.

Regardless of how you spin it I must rely on reliable research published in peer reviewed respected publications showing that the American and Canadian systems of health care produce nearly identical results over time.

If you really believe that the U.S. system provides significantly better health care outcomes for people than Canada's I have a bracelet I will give you free (you only pay shipping and handling) that is clinically proven to make you lose weight while you sleep!!

At 12/04/2007 1:56 PM, Blogger VH said...

This comment has been removed by the author.

At 12/04/2007 2:44 PM, Blogger VH said...

Anonymous: Keep your probably got it for a reason. If you ever need a hip replacement or develop colon cancer (I'm would not wish this on you or anybody-ever) you'll better hope that your south of the Canadian border. Unless you enjoy waiting. I will also point out that governments are very good at hiding the true costs of their bloated programs; it is in the best interest of a politician to seem efficient and capable of meeting everyone's needs when in reality, their populist program tend to be at best negligible. I hope you don't actually believe that welfare/social programs are efficient? As the "peer reviewed respected publications" seems to conclude? I would have a bridge to sell you if you did. As Chief Justice Beverley McLachlin asserted, "Access to a waiting list is not access to health care." Does the U.S. system need major reform? Yes, it does. Should we adopt single-payer? Hell, no.


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