The US government has undertaken a huge campaign against PHARMAC,
the government organizaton that subsidizes pharmaceutical
prices in New Zealand.
Among the"barriers to trade" that USTR listed for 1999 is this item:
In general, PHARMAC will not apply a subsidy
to a new medicine unless it is offered at a price
lower than currently available subsidized medicines
in the same therapeutic class or unless the
producer is willing to lower its price on another
medicine already subsidized in another class.
Pharmaceuticals can also be delisted if a competing
product is selected to serve the market
as the result of a tender or if a cheaper
alternative becomes available and the manufacturer
of the original product refuses to discount its price
to that of the lower-priced alternative.
PHARMAC's use of reference pricing, the practice of
doing trade-off deals between classes of drugs, and
tendering practices can negatively affect a company's
revenue return on its intellectual property.
I don't know what insurance policies the USTR provides its employees,
but they might spend a little time looking at the HMO industry in the
US to better understand what PHARMAC is up to.
- USTR's 1999, 1998, 1997, 1996 and 1995
NTE Reports on New Zealand