Associated
Press August 21, 2019 02:06 PM
Drug companies are still raising prices for
brand-name prescription medicines, just not as often or by as much as they used
to, according to an Associated Press analysis.
After years of frequent list price hikes, many
drugmakers are showing some restraint, according to the analysis of drug prices
provided by health information firm Elsevier.
In the first seven months of 2019, drugmakers
raised list prices for brand-name prescription medicines by a median of 5%.
That's down from about 9% or 10% over those months the prior four years, the AP
found. From January through July this year, there were 4,483 price hikes, down
36% from that stretch in 2015.
Several large manufacturers skipped their usual
midyear increases, noted Elsevier drug-pricing expert Kay Morgan. Those include
industry titans taking heat for high prices, including Pfizer, Novartis, Amgen,
AbbVie and Johnson & Johnson.
For years, they and many other drugmakers raised
list prices on brand-name medicines up to three times annually, sometimes 10%
or more each time. Now, companies are taking more of their increases in
January, reaping the extra revenue all year and forgoing early summer hikes.
Still, there were 37 price hikes for every
decrease in the first seven months of 2019.
The industry's restraint comes as lawmakers of
both parties in Congress and the Trump administration are advancing measures to
try to curb costs, a concerted effort not seen in Washington for years.
Meanwhile, many states are trying to limit drug price increases or to allow
residents to buy drugs at lower prices from pharmacies in Canada.
"This rhetoric around drug prices may be
starting to bend the curve, but we're not getting to the point of actual
decreases in the total cost of drugs," just a slowing of increases, said
Adrienne Faerber, who teaches health economics at the Dartmouth Institute for
Health Policy and Clinical Practice. "Very few drug prices go down."
The AP analyzed 32,795 U.S. list price changes
for brand-name prescription drugs from Jan. 1 through July 31 for 2015 through
2019, focusing on each year's first seven months because of the seasonality of
price changes. For most drugs, the figures include multiple products: different
dosages, package sizes and formats such as pills, liquids and injectable drugs.
Manufacturers set list prices, and say they need
to keep raising prices to fund research on future medicines. What patients pay
varies. Many people with health insurance pay a flat price far below the list
price, but those with high-deductible insurance plans and certain seniors on
Medicare can pay much more, sometimes the entire list price or a sizable
percentage of it.
The latest data show no sign of the massive
price cuts President Donald Trump predicted in May 2018.
The monthly Consumer Price Index does show that
average drug prices people pay declined 2% from June 2018 to June 2019. But
that's because 90% of prescriptions filled in the U.S. are for generics, whose
prices have been declining amid pressure from big drug distributors. That trend
obscured price increases for the 10% of prescriptions filled with the more
expensive brand-name drugs.
Many of this year's brand name price increases
were under 5%, and some drugmakers haven't raised prices for over a year.
But several doubled prices — and some went for
more.
Ajinomoto's Cambrooke Therapeutics business
hiked prices by 3,083% for five nutritional supplements needed by people with
certain genetic conditions. A company spokeswoman declined to comment.
Stacie Dusetzina, a drug price expert and
assistant professor of health policy at Vanderbilt University, thinks
drugmakers may be trying to give Trump a political win by taking fewer
increases and limiting them to their biggest moneymakers.
Dusetzina said some drugmakers may be making up
for that by launching their new drugs at higher list prices.
"I think everybody's just gotten caught up
on how to play" the game, she said.
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