Cost Burden of Prescription Drug Spending in Canada and the United States, 2007 Edition

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Many drugs, generics in particular, are significantly more expensive in Canada than they are in the United States. On balance between the higher prices paid for brand name drugs and the much lower prices paid for generic drugs in the US, Americans spend about the same percentage of their incomes on prescription drugs as Canadians.

Some people think that American prices for prescription medications are excessive because they are often higher than prices in Canada and that this means the overall cost burden of prescription drug spending in the United States is unfair. But the fact is that the relative burden of prescription drug spending is roughly equivalent in both countries.

This finding is partly explained by the fact that many drugs, generics in particular, are significantly more expensive in Canada than they are in the United States. On balance between the higher prices paid for brand name drugs and the much lower prices paid for generic drugs in the US, Americans spend about the same percentage of their incomes on prescription drugs as Canadians.


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