Economists Honored for Study on Drug Prices, Medical Innovation

New Report on 2008 U.S. Health Research Investment Points to Need to Stimulate Medical Innovation
Tuesday, October 13, 2009

WASHINGTON—October 13, 2009—The 2009 Garfield Economic Impact Award was presented today to Darius N. Lakdawalla, PhD, associate professor at the University of Southern California School of Policy, Planning and Development, and his co-authors for their study "U.S. Pharmaceutical Policy in a Global Marketplace," published in Health Affairs earlier this year.

Lakdawalla and his co-authors explored ways to lower U.S. prescription drug prices without creating unintended consequences in cost to consumers, quality of life or future drug innovation. Their thought-provoking conclusions suggest the value of reduced drug copayments for consumers, as opposed to U.S. price controls, as a strategy to promote current use as well as future development of new pharmaceuticals. 

"We hope that by showing how out-of-pocket costs for prescription drugs can be lowered for consumers without stalling medical innovation, our study will inform policy makers as they debate health care reform," said Lakdawalla."Promoting further investment in medical research and innovation is an important way to help get our economy back on track."    

The co-authors of the study are Dana P. Goldman, PhD, director of the Leonard D. Schaeffer Center for Health Policy and Economics at USC and senior principal researcher at the RAND Corporation; Pierre-Carl Michaud, PhD, associate economist at RAND; Neeraj Sood, PhD, associate professor at the USC School of Pharmacy and economist at RAND; and Robert Lempert, PhD, senior scientist at RAND.    

The 2009 Garfield Award was presented at the U.S. Chamber of Commerce, followed by a discussion among Lakdawalla; Mark McClellan, MD, PhD, director, Engelberg Center for Healthcare Reform, Brookings Institution; and James Madara, MD, CEO, University of Chicago Medical Center. Moderated by David Leonhardt, "Economic Scene" columnist for The New York Times, the discussion focused on the essential role of research in the U.S. economy.

Research!America released its annual Investment in U.S. Health Research report at the event. The report estimates that the U.S. public and private sectors spent roughly $131 billion last year on research to find new ways to treat, cure and prevent disease and disability. That amount is $9 billion more than in 2007 and just 5.5% of the $2.38 trillion projected for overall U.S. health spending in 2008- in other words, just 5.5 cents of each health dollar.

Like the winning study, the report points to the importance of investing in research to foster scientific innovation and turn science into solutions for our economy and our health care system.

The Garfield Award is supported by the Eugene Garfield Foundation and the University of Chicago Medical Center, one of the nation's leading academic medical centers and research enterprises. For more information on current and past winners of the Garfield Award, visit: http://www.researchamerica.org/economicimpact_award

Research!America is the nation's largest not-for-profit public education and advocacy alliance working to make research to improve health a higher national priority. Founded in 1989, Research!America is supported by 500 member organizations that represent the voices of 125 million Americans. Visit www.researchamerica.org.

Media Contacts

Robert Shalett
Director of Communications 
571-482-2737

America’s economic destiny lies in innovation, technology, science and research.
The Honorable John E. Porter