NCPA - National Center for Policy Analysis


September 21, 2005

Newer drugs that are highly promoted and widely prescribed offer few, if any benefits over older medications that sell for a fraction of the cost, according to a study reported in the New England Journal of Medicine.

Looking at four new-generation drugs, called atypical antipsychotics, and one older drug, the researchers found:

  • All five drugs blunted the symptoms of schizophrenia, a disabling disorder affecting three million Americans.
  • Almost three-quarters of the patients who participated stopped taking the drugs they were on because of discomfort or specific side effects;
  • One of the newer drugs, Zyprexa, from Eli Lilly, helped more patients control symptoms significantly longer than the other drugs but it also had a higher risk of serious side effects -- like weight gain -- that increase the risk of diabetes.
  • The new drugs account for $10 billion in annual sales and 90 percent of the national market for antipsychotics.

Psychiatrists believe the findings will not significantly alter the prescribing patterns of doctors in private practice, who often do not have to worry about cost. But observers say they are likely to have an enormous effect on state Medicaid programs, many short on funds in part because of the high cost of schizophrenia drugs.

John C. Goodman, president of the National Center for Policy Analysis, estimates that Medicaid programs spend at least $3 billion a year on antipsychotics, more than for any other drug class.

Goodman says the new study presents an opportunity but also a risk. The opportunity, he says, is to lower the cost of these drugs; the risk is that state Medicaid programs use this excuse to entirely deny some patients access to more effective and more expensive drugs which work for those patients.

Source: Benedict Carey, "Study Finds Little Advantage in New Schizophrenia Drugs," New York Times, September 20, 2005; and Jeffrey A. Lieberman, et al., "Effectiveness of Antipsychotic Drugs in Patients with Chronic Schizophrenia," New England Journal of Medicine, Vol. 353, No. 12, September 19, 2005.

For text (subscription required):


Browse more articles on Health Issues