Pharmaceuticals exam 2025 with correct answers

Pharmaceuticals exam 2025 with correct
answers




What is the evidence behind the benefits of pharmaceuticals? - correct answer
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Pharmaceuticals associated with 40% of the two-year increase of life expectancy achieved in
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52 countries (1986-2000)
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Doubling of pharmaceutical expenditures associated with ~ 1 year increase in life expectancy
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(depending on countries age distribution)
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Pharmaceuticals are the ____ largest share of the NHE. - correct answer Third
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What was the historic trend for drug spending in the US? - correct answer Drugs used to be a
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much smaller part of the NHE
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Sharply rising prescription drug expenditure growth nationwide in the mid- to late 1990s
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caused noticeable growth in prescription drugs as a share of total health spending.
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, What is the trend for rate of growth in pharmaceutical spending? - correct answer Prescription
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drugs had the largest rate of growth for spending in the NHE, especially in the 80s and 90s.
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Spending increases have been abating more recently. g g g g g g




How much has Rx spending grown since the 90s? - correct answer 71% increase in Rx
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purchasing (1994-2005, only 9% population growth) g g g g g




Retail prescriptions per capita increased from 7.9 to 12.3
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What are the factors driving Rx spending growth? - correct answer Aging
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35-44 2.9 scripts/year g g g




65-74 9.1 scripts/year g g




More insurance for drugs
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New innovative drugs increase things we treat with drugs
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Ex. Hyperlipodemia (high cholesterol)
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Price
Retail price* has increased an average of 8.3%—not good
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Avg. inflation rate was 2.5%
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Negative welfare effects if purely price g g g g g




Volume increase greater than price increase
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Types of Drugs Used (extensive and intensive changes)
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Patented to Generic (Spending decrease, intensive, positive welfare)
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New Drug replaces old drug or new treatment (Spending Increase, Substitution effect,
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ambigious welfare) g




Competition, substitution g




New Drug in competitive class (could decrease, likely positive welfare)
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Completely new drug very likely welfare enhancing g g g g g g