IDEAS home Printed from https://ideas.repec.org/p/cbo/wpaper/56905.html
   My bibliography  Save this paper

CBO’s Model of Drug Price Negotiations Under the Elijah E. Cummings Lower Drug Costs Now Act: Working Paper 2021-01

Author

Listed:
  • Christopher Adams
  • Evan Herrnstadt

Abstract

One of the inputs that the Congressional Budget Office used to estimate the budgetary effects of the Elijah E. Cummings Lower Drug Costs Now Act (H.R. 3) is a simulation model of price negotiations. CBO modeled those negotiations using a Nash bargaining framework, which was based on the gains to each party—the government and the manufacturer—from a successful negotiation. The gain to the government was estimated to be the avoided cost of purchasing the next-best alternative treatment, plus the incremental clinical value of using the drug of interest instead of the

Suggested Citation

  • Christopher Adams & Evan Herrnstadt, 2021. "CBO’s Model of Drug Price Negotiations Under the Elijah E. Cummings Lower Drug Costs Now Act: Working Paper 2021-01," Working Papers 56905, Congressional Budget Office.
    • Handle: RePEc:cbo:wpaper:56905
    as

    Download full text from publisher

    File URL: https://www.cbo.gov/system/files/2021-02/56905-Drug-Price-Negotiations.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dubois, Pierre & Gandhi, Ashvin & Vasserman, Shoshana, 2022. "Bargaining and International Reference Pricing in the Pharmaceutical Industry," CEPR Discussion Papers 17293, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cbo:wpaper:56905. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/cbogvus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.