Considering the potential impact of drug coupons on the market

A coupon has the immediate and obvious effect of lowering the amount one pays upfront. To examine the potential effects of coupons on the drug market, HealthAffairs considered the 200 highest expenditure drugs of 2014.

Of the 200 drugs, 90 had coupons. These 90 were branded drugs for which one of the following was true: a generic equivalent existed, only imperfect substitutes existed, or no generic equivalent existed (meaning either there was no competition for the drug or only branded equivalents existed). Each category has a different potential impact on the drug market.

Researchers found that for branded drugs with generic substitutes, a coupon may incline consumers to purchase the more expensive brand-name drug instead of the lower-priced generic. If using a coupon means a consumer is responsible for the same copayment for a brand-name drug as for its generic equivalent, the generic equivalent's lower cost is meaningless for the consumer. On the other hand, for branded drugs with no substitute or only brand-name substitutes, a coupon can increase affordability for consumers by lowering copayments. This means improved access to drugs for patients, which is a clear benefit.

The debate on the usage of drug coupons has two extreme arguments on either side: in some situations, coupons can lead to higher costs of branded drugs (as borne by insurance companies and therefore by individuals); on the other, coupons can increase accessibility to patients, especially if no generic substitute for the drug exists. In the case of brand-name drugs with imperfect substitutes, the potential effects on the drug market are more variable: substitutes may be suitable replacements for some patients, but for others, the substitutes may not be viable candidates due to drug interactions or other circumstances. Policy on drug coupons will need to take into account these various situations in order to avoid hurting the beneficiaries of coupons while trying to rein in drug prices.