This volume examines the economics of the biopharmaceutical industry, with eighteen chapters by health economists.

On October 25,1999, the President directed the Secretary of Health and Human Services to study prescription drug costs and trends for Medicare beneficiaries. He asked that the study investigate: price differences for the most commonly used drugs for people with and without coverage; drug spending by people of various ages, as a percentage of income and of total health spending; and trends in drug expenditures by people of different ages, as a percentage of income and of total health spending. This report is the Department's response to that request. It represents the work of individuals and agencies throughout the Department, including the Agency for Healthcare Research and Quality (AHRQ), the Food and Drug Administration (FDA), the Health Care Financing Administration (HCFA), and the Office of the Assistant Secretary for Planning and Evaluation (ASPE).

The book provides an overview of the major features of US health care and an outline of the reforms required to impose more discipline on costs without compromising quality and innovation. A major theme is the need for building a regulatory structure around the choices available to consumers to allow them to find higher-value and lower-cost options for the services they need.