Why pharmaceuticals are cheaper abroad

Americans, on average, pay some of the highest prices in the world for prescription drugs.

Story highlights

  • 72% of Americans think drug costs are unreasonable
  • Costs $2.6 billion to bring a drug to market
  • U.S. pays highest prices in the world for prescription drugs

(CNN)The United States spends some of the lowest amounts of its total healthcare on prescription drugs relative to other developed nations. But Americans also pay some of the highest prices for those drugs, relative to the rest of the world.

In order to pay for a monthly prescription for Nexium, the popular acid reflux drug, an insurer in the United States pays, on average, $215 per customer. Yet the same prescription in the Netherlands costs about one-tenth less, just $23.

    How much drugs cost in the U.S.

    According to the International Federation of Health Plans, Americans pay anywhere from two to six times more than the rest of the world for brand name prescription drugs. Specialty and cancer drugs tend to be the most expensive, but the sky-high prices can be found in commonly used meds as well. For example:
    -- Gleevec (a cancer treatment): $6,214 (per month/per customer) in the United States, compared to $1,141 in Canada and $2,697 in England.
    -- Humira (for rheumatoid arthritis): $2,246 in the United States, compared to $881 in Switzerland and $1,102 in England.
    -- Cymbalta (for depression): $194 in the United States, compared to $46 in England and $52 in the Netherlands. In fact, there is also a generic version of Cymbalta so these prices reflect having a cheaper alternative.
    Most Americans feel that drug companies are putting profits before anything else. A recent poll from the Kaiser Family Foundation found that 72% of Americans think drug costs are unreasonable and want drug companies to release information on how they set prices.
    Tom Sackville, CEO of the IFHP, said that American consumers have little recourse against the high prices. "Consumers are pretty much unprotected from whatever price," he said.

    Pharmaceuticals say high price reflects high cost of development

    According to PhRMA, the pharmaceutical trade group, high prices are a reflection of the research and development costs it takes to bring a drug to market. PhRMA cites that on average, it takes more