The prices of similar cardiac implants in the U.S. were higher than in the four largest E.U. markets between 2006 and 2014, according to a new study by British researchers. U.S. prices were two to six times higher than those in Germany and varied widely among the European countries studied.
The study, published in the journal Health Affairs, examined the prices charged by large hospitals in six U.S. markets and in France, Germany, Italy and the U.K. for coronary stents, pacemakers and implantable cardioverter defibrillators (ICDs). It is the first systematic comparison of cardiac implant prices between the U.S. and the largest European markets over time, according to the researchers from the London School of Economics and Political Science.
Price differences were more pronounced for stents than for cardiac rhythm management (CRM) devices. While stent prices have generally declined over time, CRM prices remained more stable. ICDs and cardiac resynchronization devices with defibrillating functions had similar or higher prices in the U.K. throughout the entire study period. Mean prices of dual-chamber ICDs in the U.S. were similar to prices in Italy since 2007, and prices of bare-metal stents in the U.S. were similar to those in France since 2013.
Prices were generally estimated to be lowest in Germany for all devices considered, except cardiac resynchronization devices with pacing function. For example, mean drug-eluting stent prices in the U.S. consistently exceeded those in Germany by approximately $1,000 throughout the study period. U.S. hospitals charged about 1.6 times more than their German counterparts for a drug-eluting stent in 2006 (an estimated $1,440 in Germany) and four times the German estimated price of $340 in 2014.
Hospitals in the U.S. and France charged mean bare-metal stent prices of $670 and $750, respectively, in 2014, about five to six times higher than prices in Germany. Mean prices of dual and single-chamber pacemakers in the U.S. in 2014 were approximately $4,200 and $3,700, respectively, three and nearly five times those in Germany ($1,400 and $800, respectively).
The researchers analyzed data from Marketrack hospital surveys conducted by Millennium Research Group. They cited several possible reasons for the price differences:
- Purchase prices are often the result of negotiations or tendering between manufacturers and individual hospitals, group purchasing organizations, or healthcare payers.
- Prices are usually confidential, which allows manufacturers to charge different prices to different buyers, depending on their bargaining power.
- To keep competition down, larger manufacturers can leverage their resources to fund R&D and obtain regulatory approval, and count on brand loyalty among physicians.
- Those companies often acquire startups with promising technologies and develop them further, leading to market concentration among a few large competitors.
- Physicians may be insensitive to price, and/or have relationships with manufacturers that affect their implant choices.
Pinpointing exact reasons would require more data collection and larger samples, according to the study.
“While these findings can help policymakers assess whether technology-related policies in their country are effective at controlling the prices of cardiac devices, future research could explore the reasons for the observed variation in prices and help policymakers understand which mechanisms are available to control device prices,” the researchers concluded.