US drug-pricing pressure could add hundreds of millions to Swiss costs

A US pricing push could land on Swiss insurance bills. A study by researchers at ETH Zurich and the University of Zurich warns that pharmaceutical companies may seek higher prices in other countries as Washington presses them to lower prices in the United States. If Switzerland accepts those increases, households could face additional annual costs amounting to hundreds of millions of francs.

The pressure matters in Switzerland, where medicine prices are already among the world’s highest, though US prices are steeper. For Swiss-based pharmaceutical companies Roche and Novartis, lower prices in their largest market would mean lower revenues. Companies are pressing other countries to accept higher prices, according to the study.

The consequences reach beyond negotiations between governments and drugmakers. Higher medicine prices affect healthcare insurance bills, connecting international pricing decisions to household costs in Switzerland. The study’s co-author, Kerstin Vokinger, says the country must consider carefully how it responds to US pressure.

The US plan ties American prices to a group of reference countries. The proposed “most-favoured nation” approach would compare US medicine prices with prices in countries that include Switzerland. That gives pharmaceutical companies a reason to seek higher prices in those markets: the higher the reference-country prices, the higher US prices could remain.

The same mechanism can put countries in competition with one another. A government that refuses a price rise may worry that companies will consider its market less attractive for launching new medicines. Vokinger says no country wants to be left with the lowest prices and risk losing access to innovative treatments. That fear could drive countries to outbid one another.

Swiss prices do not currently play a decisive role in US pricing because they are not among the lowest internationally, Vokinger says. Their influence would grow if other countries also raised their prices. For Switzerland, the issue is therefore linked to decisions made across the wider group of countries used in US price comparisons.

Swiss drug prices are already high by international standards. The uncertainty lies in how the United States will ultimately set prices, but the policy debate is already shaping company arguments. René Buholzer, head of Interpharma, the association representing major pharmaceutical companies in Switzerland, says companies must adapt because prices in the small Swiss market can affect the much larger US market.

In practice, Buholzer argues, higher Swiss prices may be needed to keep innovative medicines available in the country. The Swiss Federal Office of Public Health rejects the case for raising prices across the board. It says the long-term implementation of US pricing models remains uncertain.

That disagreement puts two concerns into direct policy debate: the price Swiss patients and insurers pay, and companies’ decisions about bringing new medicines to the country. The study’s warning is conditional. If Switzerland and other countries give in to pressure for higher prices, Swiss households could bear a substantial share of the resulting costs through healthcare insurance bills.

Companies’ launch and reimbursement decisions are already part of the debate. Interpharma says a survey of its member companies found that around one-third of approved medicines are no longer being submitted to the health ministry for reimbursement approval. The Federal Office of Public Health, however, says it received roughly the same number of applications as in the previous year.

Access to innovative medicines remains important for patients in Switzerland. Companies ultimately decide whether to apply for reimbursement for a medicine, while the government weighs the consequences of pricing policies for the health system and households.

Vokinger argues that Switzerland should work with other countries to find common solutions. That cooperation matters because a country acting alone may fear losing access to new treatments, while higher prices in several markets could feed into the US reference-price system. Switzerland’s response will have to account for both the costs borne through insurance and the availability of medicines that patients need.