Shopping Around: Incredible price differences on prescription drugs

The following is an excerpt from a Full Measure interview with Barbara Anthony, a healthcare cost expert with Pioneer Institute. How and why are prescription drugs priced the way that they are?

Barbara Anthony: We chose 44 pharmacies all around the state of Massachusetts. We called. We pretended to be consumers. We were self-pay. We wanted to make that clear. We were paying cash on the barrel head here and we asked for the price of 5 generic drugs and 3 brand name drugs from each of these pharmacies. And we obtained the price as best we could.

Sharyl: When they were able to get the information over the phone, they ended up with some important and surprising results. There were wide, unpredictable variations in drug prices that, to the average consumer, have no rhyme or reason.

Barbara Anthony: We found some staggering differences in price.

Sharyl: Amoxicillin, it’s a popular antibiotic, what were the price ranges for that?

Barbara Anthony: We were shocked at the range. This is a generic drug now not talking about brand name. It’s a generic antibiotic.

Sharyl: Amoxicillin ranged from $4.00 to more than $20…There’s a very popular generic to control cholesterol; Atorvastatin. According to your study, you found prices as low as $4 at one pharmacy but $199 at another pharmacy, an outlier?

Barbara Anthony: Independent stores were selling this drug for 10-15 dollars. All of the chains we looked at were higher. They were 70, 80, 90 over $100. This is the same drug. It’s a generic drug. It is very cheap.

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