It’s January, so you can be pretty sure of a few things. You’ll need a heavy coat before you head outdoors. You can find plenty of retail markdowns during post-holiday sales. And football fever grows by the week.
Oh, and of course, drug manufacturers have raised prices on hundreds of drugs, from insulins to heart medications. You can almost set your calendars each January and July when the drug industry increases prices.
So far this month, drugmakers have hiked prices on 636 drugs, by an average of 4.2%, according to research by GoodRx, which tracks prescription drug prices and offer a mobile app to help consumers find the lowest prices on hundreds of drugs.
The increases come in the middle of a pandemic that has killed more than 374,000 Americans and ravaged the U.S. economy, throwing thousands out of work.
Drugmakers have been under scrutiny in recent years as some government leaders have charged that many prescription drug prices are too high, putting them out of reach of people who need the medicines.
In 2017, President Trump said industry has “a lot of lobbies, a lot of lobbyists, a lot of power.” He added it was “getting away with murder” and that he might try to negotiate the prices Medicare pays for everything from cancer drugs to arthritis medicines. But, so far, none of that has happened. And drug prices keep going up.
You can scroll through a table at the GoodRx website to look for price hikes on your favorite drugs or drugmakers by using this link.
Indianapolis-based Eli Lilly and Co. has raised prices on at least 11 drugs. The price hikes range from 2.93% on antipsychotic Zyprexa Zydis to 5.9% on diabetes medicine Trulicity. The GoodRx table did not show whether Lilly lowered any prices.
In response, Lilly said it is “committed to working for greater affordability and access to our medicines,” while still allowing for enough revenue to invest in in treatments for diabetes, cancer, Alzheimer’s disease and other maladies.
“Over the past several years, we have been restrained in our list price increases, even while providing higher discounts and rebates to our customers,” the company said in an email to IBJ. It said it expects low-to-mid-single digit net price declines in the U.S. this year.
Other drugmakers raised prices on dozens of products. Merck & Co. raised prices on 14 drugs, AstraZeneca hiked the price of 17 drugs, and Pfizer Inc. increased prices on a whopping 136 drugs.
This year’s average price hike of 4.2% is a bit lower than in previous years: up an average of 6% in January 2020, and up 5.2% in January 2019.
These price increases are for a drug’s list price: the official price of a drug set by the manufacturer. It’s not the price that most pay at the pharmacy due to a complex system of discounts and rebates, often set by middlemen, known as pharmacy benefits managers, or PBMs.
But GoodRx said its research shows that 95% of all list price changes have “downstream effects on prices that consumers pay at the pharmacy.” In other words, your out-of-pocket prices on medicines are likely to increase this year as well.
But some other price trackers say the impact of price hikes is not that dire. Drug Channels, a heavily-followed drug blog, said that in 2020, brand-name drug net prices dropped for the third consecutive year. “Meanwhile, brand-name drug list prices grew at their slowest rate in at least 20 year,” the blog said.
The industry lobby, Washington, D.C.-based Pharmaceutical Research and Manufacturers of America, said price increases for many have actually fallen.
“There are numerous facts to show that net prices for many brand medicines have fallen, but it often doesn’t feel that way for patients because of a broken insurance system that discriminates against people who need care,” Brian Newell, PhRMA spokesman, said in an email. “We want to work on solutions that will fix the broken system and lower what patients have to pay out of pocket for their medicines.”
But some net prices to consumers have actually declined because of large rebates to PBMs, the Wall Street Journal reported.
“During the third quarter of 2020, net prices fell 2.3% versus a 4.7% drop in 2019, according to SSR Health LLC pharmaceutical analysts. While list prices have risen on average nearly every quarter since 2017, net prices have declined during that time,” the Journal reported.
Some other data researchers agree that prices have gone up, but not as high as the average of 4.2% computed by GoodRx.
Rx Savings Solutions, which sells software to help employers and health plans choose the least-expensive, said drugs increased by an average 3.3% this year. About 70 companies raised prices, the firm said.