At the tip of September, a spot of excellent information: Relyvrio, a brand new drug for treating amyotrophic lateral sclerosis—or ALS, a neurological dysfunction and not using a remedy—was accepted within the United States. The ALS neighborhood rejoiced; the drug’s authorization was described as a “long-sought victory for patients.”

But the following day, the worth of the medication was revealed: $158,000 a 12 months. This was far greater than what the Institute for Clinical and Economic Review, an impartial nonprofit that analyzes well being care prices, had estimated can be an inexpensive worth, which it deemed to be between $9,100 and $30,700.

Americans, although, most likely weren’t shocked. Prescription medication within the US value about 2.5 occasions what they do in different international locations, and a quarter of Americans discover it troublesome to afford them. Almost each new most cancers drug begins at over $100,000 a 12 months. And a 2022 research discovered that yearly, the typical worth of newly launched medication is 20 % greater.

How drug costs are set within the US is a mysterious black field. When rationalizing their lofty worth tags, one of the vital frequent causes pharmaceutical firms will cite is {that a} excessive worth is required to make good on the cash invested in analysis and growth.

But is that true? “You hear it so much,” says Olivier Wouters, an assistant professor of well being coverage on the London School of Economics and Political Science. “That’s why I was like, well, let’s get some data, because I don’t believe it. I don’t think anyone believes it.”

So Wouters did simply that. In September 2022, he and his colleagues printed a brand new paper in JAMA that took this straightforward argument and put it to the take a look at. In the research, they seemed on the 60 medication that had been accepted by the US Food and Drug Administration (FDA) between 2009 and 2018 for which there was publicly out there details about each R&D spending and pricing. And then they matched up the figures. “Essentially, it was like investigative journalism—check all the receipts, trace back in time on what they spend,” he says. If it have been the case that R&D spending was the rationale behind excessive drug costs, you’d anticipate to see a excessive correlation between the 2. Instead, they discovered no correlation.