Our analysis … looks at the first 25 medicines for which Medicare officials have already set government prices. We estimate that the price controls have, or will, reduce those drugs’ net prices by about 37%, on average, relative to a world without government price setting.
In our model, that drop in brand-name drugs’ revenue leads to a 38% decline in the number of generic or biosimilar competitors coming to market. As a result of this decreased competition, the price of those post-exclusivity generics and biosimilars would be 45% higher, on average.
Source: Tomas Philipson