Every drug page on this site opens with a figure labelled the pharmacy cost. It comes from a federal survey called NADAC, and it is the most useful number on the page and the easiest one to misread. This is what it is.
What it measures
NADAC stands for National Average Drug Acquisition Cost. The Centers for Medicare & Medicaid Services survey retail pharmacies and ask what they actually paid their wholesaler for a drug. The average is published, updated weekly, and free for anyone to download.
So it is not a list price, not a negotiated rate, and not what any insurer pays. It is closer to the raw material cost of your prescription.
What it is not
It is not a price you can pay. No pharmacy will sell you a drug at acquisition cost. They employ pharmacists, hold stock, carry insurance and pay rent, and none of that is in the number. A markup over NADAC is not evidence of gouging; it is how a pharmacy exists.
It is not available for everything. CMS surveys drugs dispensed on prescription under Medicaid, so shelf products are rarely in it — about 2.8% of over-the-counter national drug codes against 21.8% of prescription ones. When a page says “not surveyed”, that is why, and for an over-the-counter drug the shelf price is the real price anyway.
It is an average. One pharmacy's actual cost will be above or below it, depending on their wholesaler and volume.
How to use it
As a floor to measure against. If a cash price is a little above NADAC, the pharmacy is making an ordinary margin and you are unlikely to do much better anywhere. If it is several times NADAC, the difference is not the cost of the drug — it is the cost of where you are buying it, and that is worth ten minutes of looking.
That is the whole design of this site. We show the floor, then everything we can find that you can actually buy, ranked by what you hand over at the till with fees included. The gap between the two is the number that matters.
Why we show it at all
Because a price on its own tells you nothing. “$62.73” is meaningless until you know whether the drug cost $60 or $4 to acquire. Nearly every other price tool shows you a number and asks you to trust it. We would rather show the arithmetic and let you decide whether it is reasonable — including on the occasions when the answer is that the price you were quoted is fine.
NADAC is public domain, published by CMS, and updated weekly. We re-ingest it on a schedule and every figure on the site carries the date it was checked. You can see every source we use and go and check them yourself.