The Hidden Cost of Relief: How America’s Drug Pricing Model Became a Global Outlier

By Eshorjit | Infinitrix News Editorial Desk | 9 May 2025

America’s Paradox: Innovation and Inaccessibility

The United States boasts some of the most advanced pharmaceutical innovations on the planet, but they come with a steep price. While Revlimid and Keytruda save lives, they also send patients spiraling into debt — not because of science, but because of policy failure.

The pricing strategy adopted by major pharmaceutical companies in the U.S. is unique: it is unrestricted by governmental caps and driven largely by market leverage. A cancer survivor in France pays a third of what their American counterpart does — for the same exact drug, produced in the same plant.

The Revlimid Case: How a Drug Became a Profiteering Blueprint

Initially developed by Celgene and later acquired by Bristol Myers Squibb, Revlimid is used to treat multiple myeloma. The drug was priced at around $215 per pill in 2005. By 2024, it had crossed $900 — a 319% increase with no significant manufacturing changes or therapeutic improvements.

The reason? There was no legal restraint preventing it. “Revlimid is the poster child of pharmaceutical greed,” said David Mitchell, founder of Patients for Affordable Drugs. “The company raised prices simply because it could — and investors applauded them for it.”

Taxpayer-Funded Research, Private Patents

One of the most controversial aspects of America’s pricing model is its detachment from its funding model. The majority of breakthrough drugs trace their early research to taxpayer-funded bodies such as the National Institutes of Health (NIH). A study by Bentley University found that 356 out of 363 FDA-approved drugs between 2010 and 2019 involved NIH funding.

Yet the final ownership of patents remains with corporations who, upon receiving FDA approval, set sky-high prices without accountability. “We pay twice,” notes Dr. Hagop Kantarjian of MD Anderson Cancer Center. “First as taxpayers, then as patients.”

The Lobby That Kills Legislation

Attempts to change the status quo have faced formidable resistance. In 2023 alone, PhRMA — the lobbying arm of the pharmaceutical industry — spent over $140 million lobbying Congress to block Medicare drug negotiation proposals.

“Any effort to make pricing more humane is painted as anti-innovation,” said Rep. Alexandria Ocasio-Cortez during a House Oversight hearing. “But it’s really anti-monopoly they fear — not anti-science.”

Insurance & PBMs: The Hidden Middlemen

Insurance companies and pharmacy benefit managers (PBMs) also play roles in the price web. PBMs negotiate rebates with manufacturers, but these rebates are rarely passed down to patients. The real price is buried under bureaucracy, leaving consumers facing unpredictable co-pays and non-coverage shocks.

“The entire system is built on opacity,” said Elisabeth Rosenthal, editor-in-chief of KFF Health News. “Nobody really knows what the actual price is until the bill arrives.”

The Global Impact of American Prices

Due to America’s economic weight, its pharmaceutical pricing has a cascading global effect. Countries in Latin America and Asia often use U.S. prices as reference points — meaning high American pricing artificially inflates prices globally, especially for patented drugs.

Organizations like Doctors Without Borders have repeatedly criticized the U.S. model. In a 2024 whitepaper, they stated: “The American pricing model is incompatible with global health equity. It limits access, not just domestically, but worldwide.”

Is There a Path Forward?

Some hope rests on recent legislative attempts. The Inflation Reduction Act includes limited powers for Medicare to negotiate certain drug prices. However, the pharmaceutical lobby has already filed lawsuits to prevent these reforms from expanding.

Experts argue that deeper reform is needed: increased use of compulsory licensing, stricter patent expiration enforcement, and a shift to public ownership of drug pricing infrastructure.

But change won’t come without public demand. As long as the electorate remains uninformed or overwhelmed by co-pay charts and coverage clauses, corporations will continue to shape policy from behind closed doors.