Health care costs are rising as a result of a variety of factors; among them are greater utilization of services that represent cutting-edge technology and increased utilization of pharmaceuticals. In comparison to physician and hospital services, medicines are paid for out-of-pocket by more Americans due to a lack of prescription drug coverage. Recent attention on comparisons between prices in the United States and prices in other countries has caused many to wonder why the same medicine is often priced differently in different countries. As a result of greater personal expense and the perception that medicines are less expensive outside of the United States, greater attention is being paid to the issue of high pharmaceutical prices.

The price of Merck medicines around the world is determined by several factors, including: market competition, government regulation and currency fluctuation. Merck considers the competitive and regulatory conditions in each market individually, and seeks to price its products accordingly. Thus, patients in one market do not pay more for Merck medicines as a result of sales at a lower price in another market.

A major factor in determining medicine prices in the United States is competition among choices caused by a free market. In countries where there is freedom to set prices, companies are encouraged to develop products that are better than those currently on the market. Free markets stimulate innovation, which leads to competition among new products and reductions in price. Given the choices available within a class of drugs today, powerful buyers in the American pharmaceutical marketplace, such as managed care organizations and health plans, have intensified price competition. These plans are able to negotiate rebates and discounts with pharmaceutical manufacturers. This kind of competition is improving the quality of pharmacy care and delivering it at a competitive price.

In countries where the government acts as the sole provider and purchaser of health care services, including most European countries and Canada, the government imposes some form of price controls or regulation of pharmaceutical prices that artificially lowers prices. These policies can have negative effects for consumers by discouraging innovation and delaying access to new medicines due to lengthy price and reimbursement control processes.

Merck will continue to support and work for the adoption of competitive pricing worldwide.

For more information on how Merck helps patients get the Merck medicines they need, including the Merck's Patient Assistance Program and the Merck Drug Discount Program for the Uninsured:

Merck's Patient Assistance Program: www.merck.com/pap/pap/consumer or call a toll-free number for patients, 1-800-727-5400

Merck Prescription Discount Program for the Uninsured: www.merckuninsured.com or call a toll-free number for patients 1-800-50 MERCK (1-800-506-3725)