OnDemand WTP Pricing Research

Trump’s drug ad price transparency contains huge loophole, researchers identify | CNN

Researchers said the price in this drug ad had a profound impact on the way people thought about the drug. Researchers made up the name, Mayzerium, as a drug for diabetes as part of the study.

“For the high-priced drug, the price disclosure significantly reduced the likelihood of participants asking their physician about the drug, asking their insurer about the drug, researching the drug online and taking the drug,” the study found.

“However, this finding weakened if the advertisement included a modifier indicating that consumers’ out-of-pocket cost might be zero.”
Lead study author Jace Garrett noted that “in a vacuum, mandatory price disclosure could be effective.”

“The problem is that many pharmaceutical companies already make use of copay programs or coupons, which our study shows mitigates the benefits of price transparency,” said Garrett, an assistant professor at the Clemson College of Business. “So unless legislation does something to curb the use of these copay programs, price transparency may have little effect.”

The pharmaceutical industry has fought the administration on the proposal. In government filings last month, Johnson & Johnson, one of the world’s largest health product companies, objected to the drug pricing transparency rule as currently proposed, saying it creates “additional confusion in an already complex health system.”

“List price alone does not provide meaningful or relevant information to consumers,” wrote Robert Donnelly, the senior director of health policy for Johnson & Johnson. “Patients want additional information beyond list price, such as a greater understanding of their out of pocket costs.”

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Trump’s drug ad price transparency contains huge loophole, researchers identify – CNN.

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