(Fortune, 2002, p. 16).

 Competition  Barriers to Entry  Regulation

Human Health = Variable of Health (Medical Care + Medications)

 Costs associated with  Research and Discovery  Manufacturing  Marketing

Degrees of Pricing 1.Charging consumers the maximum price Example: Providing a new drug that individuals desire like an AIDS medication at an unreasonable rate. 2. Charging different price depending on the quantity consumed Example: Wal-Mart purchasing a large quantity of drug X and passing on the savings to consumers compared to the local pharmacy purchasing small quantities and not receiving a savings. 3. Charging different prices for different groups of people Example: Markets, or groups of buyers with a more inelastic demand will pay higher prices.

 Copayments  Generic Substitutes  Drug Formularies

Ask doctors for 90 day supply instead of 30 days If low income- see if hospitals and pharmacies will waive co- pays Charity care Pharmacy assistance programs Extra help Program

 Provide Pharmacies incentives for dispensing generic drugs  Have insurances mail coupons to consumers to waive their co-payment if they opt for generic instead of brand name  Have physicians distribute samples of generic drug samples  Vouchers for free prescriptions to try generic products

Formulary Committees developing a list of approved drugs for:  Clinical Effectiveness  Safety  Cost

 Medicine Equity and Drug Safety Act  Medicare Prescription Drug Improvement and Modernization Act  Reimportation  Splitting pills  Generic substitutes

 Enforce already existing legislation  Enact new legislation  Price Regulation

 Structure and Regulation  Drug Prices  Monopoly  Price Discrimination  Cost Containment  Drug Formularies  Solutions and Implementation

DiMasi, J., Hansen, R., & Grabowski, H. (2003). The price of innovation: new estimates of drug development cost. Journal of Health Economics, 10( 1), Retrieved from EBSCOhost. Fortune. (2002). Largest U.S. firms and Largest Pharmaceutical firms ranked by market value. Retrieved from Getzen, T. E., & Allen, B. H. (2007). Health care economics. Hoboken, NJ: John Wiley & Sons. Hansen, R. (1996). Cost and benefit analysis in pharmaceutical promotion and untilization decisions. Journal of Health Economics, 13(1), Retrieved from EBSCOhost. Kumar,S. (2010). Drug Prices-USA Perspective. Retrieved from pharmainfo.nethttp://www Levit, K., Smith, C., Cowan, C., Lazenby, H., & Martin, A. (2002). Inflation spurs health spending in Health Affairs, 21(1), Retrieved from EBSCOhost. Mather, B. (1999). Incorporating clinical outcomes and economic consequences into drug formulary decisions: a practical approach. American Journal of Managed Care. Retrieved from EBSCOhost.

Ma, J. (n.d.). Lowering Prescription Drug Prices in the United States: Are Reimportation and Internet Pharmacies the Answer? Retrieved from bcf.usc.edu/~idjlaw/PDF/15-2/15- 2%20Ma.pdfhttp://www- bcf.usc.edu/~idjlaw/PDF/15-2/15- 2%20Ma.pdf Watson, T. (August 8, 2003). Strategies for Maximizing Generic Opportunities in Payer Populations. Retrieved from KV/is_9_4/ai_