Big Pharma’s High Prices Are Its Own Decision—and the Government’s Fault
15th December 2025
For years, pharmaceutical executives have insisted that drug prices are out of their hands. Government red tape, research costs, and reimbursement rules are all offered as explanations for why Americans pay more at the pharmacy counter than anyone else in the developed world.
It’s a tidy narrative. It’s also only half-true—pharma could easily drop its prices. But government has ensured that it has little reason to do so.
In a functioning market, companies charge what the market will bear. Those prices typically lower over time due to innovation, competition, and other factors. In only a few industries has the opposite happened—housing, higher education, and health care—all industries where incentives are skewed by government policies.