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by dekhn 1630 days ago
The direct cost to the consumer is $0 (or lira, or EU, or whatever), but that's because public healthcare negotiated with the power of a volume customer to agree on a fixed price, which is paid for by the government, which is paid for by people's taxes. So what you're doing is spreading the cost of the drug across the population. I had a similar situation when I had kaiser- no out of pocket costs.

As to why drugs are expensive in the US: because the market bears it. Demand is just elastic enough (or inelastic, I always get it backwards) in the US that providers slowly edge prices up. Sometimes they get it wrong for example aduhelm didn't sell so it had a huge price drop recently.

2 comments

Drugs are expensive partly because there is not a free market. Drugs that have been off-patent for decades which have 20 generics in other countries have none or only a few here. Anti-parasitics for example, that cost a few cents in Africa are $20 a pill here, for no reason at all, other than regulatory hurdles designed to ensure profit.
Inelastic means less price sensitive i.e. people will pay more. You can kind of think of it like immutable vs mutable.