Lilly strives to engage with governments throughout the world to offer our products at sustainable prices that are affordable for local populations. Prices for prescription medicines, like other products, can differ from country to country because of differences in currency value and market dynamics—or they may be kept artificially low by government price controls. We recognize that, for individuals, the price of medicines can present a barrier to those who might benefit from them, both in developed and emerging markets. Pricing is one way pharmaceutical companies, including Lilly, can enhance access to medicines.
Lilly believes differential pricing can help balance the desire to have affordable prices for low-income populations with rewards for innovation. We believe that providing financial incentives for pharmaceutical innovation is in everyone’s interest. Our ability to improve outcomes for individual patients depends on our discovering, developing, and commercializing innovative new pharmaceutical products. The profits we generate enable us to invest in the research necessary to bring the next generation of new medicines to the market.
Lilly advocates for policies that support differential pricing—i.e., the charging of different prices based on a purchaser’s ability to pay. Currently, many countries reference the price of medicines in other countries as a basis for setting prices for new drugs. This practice limits differential pricing because a discounted price in a lower-income country can be referenced by a higher-income country. Entering into commercial contracts with payers can support the increased use of differential pricing, if those contracts are private and the discounted price cannot be referenced. Lilly also supports efforts to decrease the final price of medicine to patients, such as through minimizing value-added taxes and markups applied in the supply chain. Finally, Lilly advocates for stronger anti-counterfeiting protections, to ensure patients receive quality-assured medicines.
Patents in Least Developed Countries
In many developing countries, Lilly does not seek nor enforce patents for our medicines, to further contribute to making these medicines more accessible. For example, Lilly does not seek patents in least developed countries (LDCs), as defined by the United Nations. As a result, generics manufacturers are free to produce and provide generic versions of our medicines in these countries.