Brand-Name Drug Prices Rose Nearly 10 Percent
4 CommentsBy Ed Silverman // May 18th, 2010 // 7:23 am
Prices for the most widely used brand-name meds jumped 9.7 during the 12-month period ending in March, according to AARP, which called the increase the largest since the organization began tracking this sort of thing in 2002. Specialty drug prices rose 9.2 percent and generics fell by 9.7 percent. AARP notes that general inflation climbed 0.3 percent during the same period.
AARP then makes another comparison - the average annual cost for three generic meds declined by $51 during this period, while there was a $706 increase for three brand name drugs. “The life-saving drugs Americans need are out of reach for many because of unjustifiable price hikes,” AARP Executive Vice President John Rother says in a statement. “Consumers desperately need a competitive prescription drug market that balances the need for innovation with access to less costly medicines.”
AARP has been criticized in the past for its annual report for, among other things, the way it views off-patent meds (see here). So this time, AARP makes a point of noting that 82 of the 219 brand-name drugs examined are off-patent. So if these are excluded from the analysis, the average annual price hike was 10 percent, indicating off-patent meds lowered the average annual change. The average annual cost for a single brand name med was about $2,190, and was $6,580 for three brand-name meds. Meanwhile, prices were raised on 88 percent, or 192 of 219 of brand-name drugs, while 27, or 12 percent, had no change in price, and only 2 of the 27 brand-name meds with no price change are still under patent (here is the full report) and the brand-name meds with the biggest price hikes.
1- Nexium – AstraZeneca - 7.4 percent
2 -Plavix – Bristol-Myers Squibb – 10.5 percent
3- Prevacid – Takeda – 8.1 percent
4 - Protonix – Wyeth – 9.3 percent
5 - Lipitor (20mg) – Pfizer – 5.5 percent
6 - Lipitor (10mg) – Pfizer – 5.5 percent
7 - Aricept – Eisai – 13.9 percent
8 - Fosamax – Merck – 6.7 percent
9 - Norvasc - Pfizer - 5.0 percent
10 - Advair - GlaxoSmithKline - 7 percent
Condor
I write — to perhaps emphasize three obvious points:
(i) Just a little math reaveals that these price increases are between 20 and 43 TIMES the rate of inflation in the USA, in 2009.
(ii) Most of these are mature brands (thus a less plausible argument for recovery of invested capital — it was long ago fully recovered).
(iii) In 2011 HSS, Medicare, Medicaid and insurance company reimbursement (pricing) ought to be driven off of 2008 prices, plus only an inflation adjuster — currently around one-third of one percent, per year.
Okay — I’ll shut up, now.
Namaste
pharmavet
It is not uncommon to raise the price on a drug such as Plavix shortly before patent expiry. It is really a double whammy for the consumer, since when Apotex comes out with generic clopidogrel next year it will likely raise it’s price by a corresponding amount while it has exclusivity.
mark
Compare Brand drug price hikes with up to 26% per year increases in tuition hikes for higher education. Nobody seems to be discussing the rising cost of higher education at local universities compared to pharmacueticals. Hmmm lets see better heath care or better education??? Ill take better health care any day.
Condor
Hello again, Mark –
(i) The fact that drug manufacturers increased prices paid — PRIMARILY by the GOVERNMENT — for their products, by 20 to 40 times the rate of prevailing inflation has absolutely NOTHING to do with getting “better health care“. CHARGING more for mature brand name drugs doesn’t — in any fashion — equate to “getting better health care“.
That’s a classic non-sequitur, on your part.
(ii) The price of higher education is spiraling unreasonably — I’ll agree with you there — but two important points need be made: (a) the government, directly (and taxpayers, indirectly) will NOT pay the bulk of those increases (in contrast to pharma price increases); and (b) most people aren’t likely ot get sicker and, in some cases, die very soon, without continuing ACCESS to higher education.
(iii) So, even though I support working to make college educations more affordable for all, any discussion of that. . . um, really has NO bearing on/relevance to this discussion — of 2009 drug price gouging.
Namaste, just the same.