The Australian system is a bit like this. The PBS (an independent government organization, which is walled off from political lobbying) will subsidize drugs, b

The Australian system is a bit like this. The PBS (an independent government organization, which is walled off from political lobbying) will subsidize drugs, but only ones which are worth it (as decided by expert panels). They act as a monopoly buyer, forcing monopoly sellers (the drug companies) to offer a more reasonable deal. If the drug is too expensive, the PBS won't subsidize it, and the drug company can lower the price (to get PBS subsidies) or face drastically lower sales.