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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (1843)	8/13/2007 12:43:23 PM
From: Robohogs	Read Replies (2) \| Respond to of 42652

us.kpmg.com Go to page 23 - 10% exactly and this includes mark-ups for middlemen. On page 57, they show generics by volume = 1/2 of total prescriptions. Unfortunately for me, this is the half I referred to and probably means the average spending is 75/25 for branded/generic (no data but close enough), meaning that split of spending is likely: 2% admin/mark-ups, 2% generics and 6% branded. Applying world pricing to US volumes and keeping middlemen the same would result in: 2% middleman, 3% generics, 3% branded resulting in drugs costs = 8% of US spending or a 2% savings on US spending. This assumes generics are 50% higher in ROW (driven by fewer generics in each foreign mkt and lower volumes) and that branded drugs are twice as expensive in US. You can mess with these assumptions but not greatly change the result which is that the evil drug guys cause TOTAL US HEALTHCARE SPENDING to be about 2% higher than it would with world pricing. Small price to pay for life extending drugs. The FDA actually puts generic cost savings at about 50% for all generic basket which would result in 67/33 split assuming no mix differences (probably bad assumption considering more expensive newer drugs are likely only patented drugs). This 67/33 split is vs. my 75/25 above. MD spending is 80+/15-20. Jon