Do higher drug costs lead to better health?

Abstract

Prescription drugs are the fastest growing healthcare cost in Canada. Increased spending is mainly due to use of newer, more expensive medicines and a higher overall volume of prescription drug use. In the large majority of cases, empirical studies fail to support claims of a net benefit to health. Newer high-priced drugs are neither consistently safer nor more effective than older alternatives. Over 2000 new drugs and indications introduced in France from 1981-2000 were compared to existing treatments: 81% offered little to no added value and 3% were less safe or effective. In Canada, only 5% of drugs introduced from 1996-2000 offered substantial improvement to therapy. Claims linking use of newer drugs to reduced hospitalization and mortality fail to distinguish between underlying differences in disease severity and treatment outcomes. For "newer" to truly mean "better", fundamental changes are needed to the regulations governing market approval and post-approval surveillance. Such changes are possible, but would require strong political will.