With America’s Attention on COVID-19, Drug Makers are Quietly Raising US Prescription Prices

With America’s Attention on COVID-19, Drug Makers are Quietly Raising US Prescription Prices

<byline>By Darrel Rowland - The Columbus Dispatch<byline>

COLUMBUS, Ohio – With most Americans focused on COVID-19 vaccines, pharmaceutical companies are quietly raising the list prices of name-brand prescription drugs at a torrid pace.

January is typically when increases hit the U.S. market. Already, more price hikes by drugmakers have been recorded in less than half a month (813) this year than for all of January 2020 (737), according to research by Ohio nonprofit 46brooklyn.

That two-week 2021 total also is approaching the record for a full January during the past decade, 895, set in 2018.

"It is clear from the data that January 2021 is bucking the recent downward trends in brand drugmaker list price increases," said one of the founders of 46brooklyn, former Ohio Pharmacists Association lobbyist Antonio Ciaccia. "And it is also clear that aside from price increases, the launch prices for new drugs has been going up over time."

The cost of prescription drugs remains among the top issues for Americans, surveys show. Three in 10 say they haven’t taken their medicine as prescribed due to costs, including many who skip doses or cut their pills in half.

It's been a key issue in races from the Statehouse to the White House, with President-elect Joe Biden promising a fix is a high priority for his administration.

Another record might come as well. To date this year, 100% of U.S. changes in drug prices this month have represented increases. That's never come close to happening; the high for the month of January over the previous 10 years is 72%, recorded last year.

COVID-19 vaccine-maker Pfizer raises prices on almost 200 drugs

Pfizer, which with BioNTech developed the first COVID-19 authorized for use by the federal government, has raised the prices on 193 name-brand drugs this month, although the median increase is a modest 0.5%.

“This modest increase is necessary to support investments that allow us to continue to discover new medicines and deliver those breakthroughs to the patients who need them,” said company spokeswoman Amy Rose in a statement.

However, the price jump was about 5% for several of Pfizer’s most popular drugs, such as Xeljanz, which treats rheumatoid arthritis, psoriatic arthritis, and ulcerative colitis; Lyrica, used for nerve and muscle pain; Ibrance, a breast cancer inhibitor; and sedative Xanax.

In January 2020, Pfizer raised the price of just 81 drugs and actually decreased the charge for 20 others. A year earlier, it was 49 price increases and one decrease.

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The brooklyn46 Research’s dashboard did not show any entries for the other COVID-19 vaccine maker, Moderna, because that company has not yet had any other drugs approved by the Federal Drug Administration.

So far this year, the median 2021 price elevation by all drugmakers is 4.9%.

But in the complex world of drug pricing, essentially no one actually pays the list price, usually called the wholesale acquisition cost. The actual, or net price is greatly impacted by rebates and discounts from the list price, and those hidden factors are rising, Ciaccia noted.

“Due to the general lack of transparency within the entire prescription drug supply chain, the public is left in the dark on our American-made drug pricing dysfunction,” he said.

The overall net cost of brand-name drugs actually fell in 2020, while list prices grew at their slowest rate in at least 20 years, according to the online publication Drug Channels.

Of course, what you pay personally is mostly affected by your health insurance.

Although generic drugs far outnumber brand names, the latter account for about 80% of drug spending in the U.S.