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The price tags for prescription drugs are a red-hot issue that is increasingly causing concern among consumers, physicians and insurers. Even some presidential aspirants are speaking out.
But how much are prices rising so far this year?
A new analysis finds that prices rose 9.1 percent through Sept. 30 for all types of medicines, which trails the 10.9 percent increase seen in 2014, according to Truveris, a health care technology firm that tracks drug pricing. Each month, the company regularly analyzes claims data involving more than 300 million payments to U.S. pharmacies for prescriptions and develops composite figures.
“We are seeing some easing,” said AJ Loiacono, the firm’s chief innovation officer and a co-founder. “So far, at least, the prices are not being raised at the same pace as in past.”
One caveat: the findings do not reflect rebates paid by drug makers to insurers or discounts that are given to consumers in the form coupons or co-pay cards.
In any event, price hikes for brand-name medicines through the first nine months of this year amounted to 13.1 percent, below the 14.8 percent registered in 2014. And prices for specialty medicines – typically, these include expensive injectable drugs for harder-to-treat diseases – climbed 7.3 percent, less than the 9.7 percent seen last year.
Still, more notable is the slowdown in price increases for generic drugs. Through September, prices rose 2.6 percent, considerably less than the overall 4.9 percent increase seen in 2014. Recent inflation for generic drugs came as a surprise, given that these medicines are viewed as a low-cost bulwark in the health care system.
The easing in generic price hikes may reflect fewer quality-control issues that, in years past, disrupted production. The FDA, however, has not been approving more generics, according to the latest figures. Presumably, a larger number of approvals would increase competition and lower prices for some drugs.
This is not to say prices for some generic drugs did not pop. If you slice and dice the medicines by therapeutic category, you’ll find that generic meds for menopause rose 22 percent. And generic anti-infectives climbed nearly 20 percent, while medicines for warts increased in price by 18 percent.
The same holds true for brand-name medicines. The cost for treating Alzheimer’s and acne rose nearly 21 percent, while treatments for thyroid disease and menopause jumped 15 percent.
Whether this trend continues through the end of the year is uncertain. As Loiacono noted, some price hikes are often seasonal. Drug makers may slap higher prices on enough medicines over the next few weeks to cause the overall increases this year to exceed 2014.
In fact, Truveris forecasts brand-name price hikes will wind up at 14.3 percent this year, while specialty drug price increases will amount to 9.2 percent. And generic price inflation will be 3.8 percent. So each category is predicted to experience higher price tags.
Then again, the popular angst over drug prices – and the proliferation of media coverage – may the pharmaceutical industry to be more conservative, if only to avoid negative publicity.
Not every drug company regularly raises prices in the same way as Valeant Pharmaceuticals or Turing Pharmaceuticals – buying medicines and then jacking up the price to previously unseen heights. But drug makers are certainly aware that their pricing is being scrutinized and have tried, not terribly successfully, that their business models are very different.
So for the moment, perhaps the trend will slow. Or not.