Author(s) :

Aarav Gupta.

Volume/Issue :

Abstract :

The United States leads the world in pharmaceutical innovation, yet it has one of the highest drug prices globally, creating significant barriers to equitable healthcare access. This paper aims to examine the structural mechanisms that drive drug price disparities between the United States and Germany, and to evaluate the potential of artificial intelligence as a complement to pharmaceutical pricing reform. This comparative analysis demonstrates that Germany’s centralized pathways, including early benefit assessment, reference pricing, and mandatory price negotiations under the AMNOG framework, constrain launch prices and accelerate post-exclusivity generic competition and price erosion. In contrast, the U.S. system is characterized by fragmented payer negotiation, legal hurdles such as the Medicare Part D non-interference clause, and direct-to-consumer advertising that steers consumers toward higher-priced brand-name drugs. The study evaluates proposals to enable centralized price negotiation and broader biosimilar access and considers emerging AI-enabled efficiencies in drug research and development to reduce drug development costs. Together, these findings suggest a multi-pronged framework for lowering drug costs and increasing access to healthcare while sustaining incentives for innovation.