Erica Carbajal – Becker’s Healthcare – Jan. 31, 2022
A month into 2022, drug makers have raised the list prices for medications in the U.S. by an average of 6.6%, compared to the 7.0% overall consumer inflation rate, The Wall Street Journal reported.
While companies kept most increases in the single digits for another year as Congress explores measures to curb high costs, they boosted list prices on cancer, diabetes and other prescription medicines.
The news outlet cited an analysis from Rx Savings Solutions, which makes software to find prescription drug savings which found that about 150 drug makers raised prices on 866 products through Jan. 20.
Here are five details from the analysis:
1. Drug makers raised prices by an average of 4.5% on 893 drugs during the same period last year. Drug price increases hit a peak in 2015 and 2016, when some drugs saw increases higher than 10%, according to The Wall Street Journal.
2. The 2022 analysis showed prices rose for some of the top-selling medications in the U.S., including AbbVie’s Humira, an anti-inflammatory, which saw a 7% increase. The price of Bristol-Myers Squibb and Pfizer’s Eliquis, an anticoagulant, rose by 6%, and Trulicity, Eli Lilly’s diabetes drug, rose by 5%.
3. Political pressure and other drug-pricing measures in recent years have made price hikes less profitable for drug companies, the Journal reports. Many pharmacy benefit managers, for example, have negotiated price increase caps that require drug makers to pay rebates on product sales that have price increases above certain thresholds.
4. The Biden administration has also proposed drug-pricing provisions in its Build Back Better bill, including one that caps price increases at the overall inflation rate across federal and private health insurance programs.
5. Pfizer, which raised prices by an average of 3.2% on 219 drugs, shared the following statement with The Wall Street Journal:
“For the past three years, our net prices — the prices we actually receive for our medications — has fallen due to higher rebates and discounts paid to insurance companies and pharmacy benefit managers.”
Greg Says has previously noted that retail prices for Rx drugs in the US have skyrocketed over the past 10 years. In 2020, Medicare Part D covered over 3,500 drugs with total spending of $188 billion which was 54% of the total Rx drug spending in the US of $348 billion. Congress needs to act to stem the rising cost of Rx drugs in the US. One step in that direction would be for Congress to allow Medicare to negotiate drug prices with the pharmaceutical industry like the VA and private insurers can.