By NextBestFitPharmaceutical manufacturer revenue
How much less drug makers receive for retail drugs under national negotiation.
Result
−$84.8B
Per resident, per year
−$249
÷ 341.1M people
Per household
−$642
÷ 132.2M households
How it's calculated
| # | Step | Arithmetic | Value |
|---|---|---|---|
| 1 | Brand share of retail drug spending | 80% | |
| 2 | Brand net price cut | 35% | |
| 3 | Resulting UHP drug rate | 80% × (1 − 35%) + 20% × 1 | 0.72× |
| 4 | Retail drug price effect (see drug spending item) | −$113.1B | |
| 5 | Manufacturer share of the price effect | 75% | |
| 6 | Manufacturer revenue change | −$113.1B × 75% | −$84.8B |
| 7 | Partly offset by higher volume (utilization effect) | $26.2B |
Inputs used
| Input | Kind | Value |
|---|---|---|
| Brand-name share of retail drug spending | estimate, medium confidence | 80% |
| Average brand net price reduction from national negotiation | estimate, medium confidence | 35% |
| Manufacturer share of retail drug price reductions | estimate, low confidence | 75% |
Trade-off: Lower prices now vs. fewer new drugs later (CBO: a narrower policy meant about 8 fewer of ~300 new drugs in a decade).