Giving Compass' Take:

• John Tierney argues that price controls for prescription drugs can stifle innovation and may reduce access to drugs, rather than expand access. 

• How can funders work to increase access to prescription drugs? 

• Learn about ways to keep prescription drug costs down


Brian Anderson: Now, critics of the pharmaceutical industry, Big Pharma, as they often call it, say that the prices of prescription drugs are getting so high that we're reaching a crisis in America. And it's true that Americans tend to pay more for drugs than Europeans. In some cases, a lot more. In this view, we need more regulation, including price controls, to bring those costs under control. What's your general response to that idea?

John Tierney: There are problems with the pharmaceutical industry and the way that drugs are regulated in price, but on the whole Americans get a much better deal than Europeans do. If we imitated them with price controls, as the Trump administration is unfortunately just recently started to do, by having Medicare, they're talking about having Medicare set as prices according to Europe, which basically means importing their price control. But if we imitated Europe, it would hurt us and it would hurt the rest of the world.

Brian Anderson: How so? Can you explain that a little bit?

John Tierney: Well, America has been called the pharmacy of the world because more than half of new drugs are developed here.

Brian Anderson: And developed by private company?

John Tierney: Exactly. The hub of pharmaceutical innovation used to be in Europe, but it's moved to the United States because we have more incentives here. We don't have the price controls that they have. This is the biggest market. And Americans actually pay less for generic drugs than Europeans do because of various factors. But what gets people so upset is that some of these new, you know, expensive breakthrough drugs do cost more in the United States, but the upside of it is that we have far more drugs, we have access to more drugs, we get them sooner than Europeans do.

Read the full control about price controls for prescription drugs between Brian Anderson and John Tierney at City Journal.