Key Highlights
- The U.S. could have saved $1.3 billion-$1.5 billion in the first year post-approval if launch prices for drugs matched value-based benchmarks, says the Institute for Clinical and Economic Review (ICER).
- Median annual net launch prices for new drugs jumped 51% from 2022 to 2024, while list prices rose 24%, underscoring rapid cost escalation across the healthcare industry.
- ICER’s analysis shows that Americans continue to pay substantially more for medicines than patients in other high-income nations.
A new report from the Institute for Clinical and Economic Review (ICER) estimates that the United States could have saved up to $1.5 billion in the first year after the launch of 23 recently approved drugs if their net, post-rebate prices had aligned with ICER’s health-benefit price benchmarks.
The findings highlight the persistent challenge of high prescription drug prices in the U.S., where patients often pay nearly three times more than counterparts in other developed countries.
ICER’s analysis found that the median inflation-adjusted annual net launch price for drugs approved between 2022 and 2024 surged by 51%, while list prices climbed 24%. It is a clear sign of escalating costs within the pharmaceutical sector and the wider healthcare industry.
“Launch prices are going up, patient access is going down, and in many cases we are overpaying for treatments,” said Sarah Emond, President & CEO of ICER, in a statement cited by Reuters.
What ICER’s Benchmark Really Means
ICER’s health-benefit benchmark determines what a drug’s fair price should be based on the value it delivers to patients throughout their lifetime.
When launch prices exceed these benchmarks, payers, insurers, and patients shoulder the difference, resulting in higher premiums, restricted access, and strained healthcare budgets.
The report adds urgency to ongoing policy debates about whether the U.S. should tie drug prices to value-based or international reference pricing systems.
The Push for Pricing Reform
Federal discussions are intensifying around proposals to align U.S. drug prices with international benchmarks, a concept that has long faced resistance from major pharmaceutical manufacturers.
Former President Donald Trump recently renewed calls for such parity, echoing a broader sentiment that American patients deserve prices comparable to global standards.
Experts say aligning prices with ICER’s value-based assessments could stabilize the spending curve in the healthcare industry while encouraging innovation that reflects true clinical benefit.
What’s Next?
With lawmakers and healthcare stakeholders increasingly focused on value-based drug pricing, ICER’s latest findings may influence future regulatory frameworks.
Tethering launch prices to measurable patient outcomes could be a pivotal step toward curbing excessive spending and improving access to essential therapies.
For now, the ICER report serves as a data-driven reminder that aligning drug prices with patient benefit isn’t just good economics, it’s a necessary evolution for a sustainable healthcare industry.