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Executive Summary

PHARMACEUTICAL MULTI-TIER PRICING STUDY BY GAO DISCONTINUED due to lack of manufacturer cooperation in compiling prescription drug price information, the General Accounting Office reports. In a letter to House Judiciary Committee Chairman Brooks (D-Tex.), General Accounting Office Associate Director for National and Public Health Issues Mark Nadel noted: "Because the manufacturers would not provide us the pricing data needed to answer your request, we have agreed with members of your staff to discontinue our efforts." GAO contacted 10 manufacturers that "accounted for eight of the leading 10 and 16 of the leading 30 prescription drugs sold in the U.S." in 1989. The letter reports that "all" of the manufacturers "denied our request for prescription drug pricing data," citing concerns about "disclosing information which they consider proprietary." The manufacturers contacted by GAO are American Home Products, Burroughs Wellcome, Ciba-Geigy, Glaxo, ICI, Marion Merrell Dow, Parke-Davis, Pfizer, SmithKline Beecham and Upjohn. Rep. Brooks requested the study last year to determine "the type, prevalence and impact" of multi-tiered pricing in the pharmaceutical industry ("The Pink Sheet" July 17, 1989, T&G-5). The congressman had asked that the study be completed by last September. GAO added that the study was further impeded when drug wholesalers failed to provide pricing information requested by the agency. "Due to clauses in their contracts with manufacturers that prohibited disclosing pricing data to third parties, the wholesalers were prevented from voluntarily releasing pricing data to us," Nedel wrote.

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