Hundreds of drug prices rising this year: footage

Prescription drug prices have increased for many drugs this year, but the average increases are not as large as in past years.

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In the first two days of the new year alone, drugmakers raised prices on 575 brand-name drugs, according to drug price research firm 46brooklyn. Prices for medicines for diabetes, HIV, cancer and more are rising.

Price increases of 10% per year were fairly normal for many years, but prices have begun to decline in recent years. Median price growth so far this year is just 4%, said 46brooklyn CEO Antonio Ciaccia.

“While it's early days, if this number holds throughout the year, it would make it the lowest median price increase in more than a decade,” Siasia said.

January is typically a popular time to raise prices on brand-name drugs, but companies can raise prices year-round. There could even be more later this month, he said.

He provided NPR with the data on the rate hike, explaining that each row of the spreadsheet tells its own story about how different layers of the health care system, government regulations and drug markets interact.

“The list price of a drug sends an important signal about what is likely to happen in the market and what incentives may be driving certain behaviors, not just by drug companies but by every layer of the drug supply chain,” Ciascia said.

The sticker price is the starting point, a bit like the sticker price on a new car. Discounts and different types of rebates can affect the actual amount paid, similar to automaker incentives. Here are the highlights of this year's price changes.

Some big names emerge

Prices for type 2 diabetes drug Ozempic and COVID-19 drug Paxlovid each increased by about 3%, according to 46brooklyn, which used National Average Drug Acquisition Cost (NADAC) data in its analysis.

NPR contacted the manufacturers of these drugs to ask why they were raising prices. Neither man elaborated on the specifics behind the price increases, but they spoke generally about the price increases for their products.

Novo Nordisk, the maker of Ozempic, said it had raised prices on some drugs due to changes in the health care system and other factors such as inflation. Notably, it didn't raise the price of Wegovy, which has the same active ingredient as Ozempic but is approved to treat obesity.

Pfizer said the modest price increases for its products would help it discover and develop new drugs and address other rising business costs.

Small price increases still matter

Drug price increases earlier this year, while smaller, were still higher than the rate of inflation (2.7%), according to the latest information from the U.S. Bureau of Labor Statistics. That means penalties for Medicaid and other programs will kick in.

But regardless, these companies are raising prices above inflation.

“To me, it's acknowledging through action that there's a lot of money to be made outside of these government programs that makes paying those fees and fines worthwhile,” Ciascia said.

Meanwhile, a new report from the American Association of Retired Persons (AARP) shows that small increases can add up over the life of a drug. The organization found that for the top 25 drugs in Medicare Part D, the average price increased 98% over the life of the drug. This means the price of the drug has almost doubled.

Consumers can pay more… or less

If the medication you need isn't covered by insurance, you'll pay more.

If the drug is covered, you may not pay the full list price, but you may pay a copay at the pharmacy counter or coinsurance. This is often tied to the drug's list price, so a higher price may mean a higher copay.

But another possibility has to do with complex health systems and their incentives. Sometimes higher prices mean drugmakers have more room to negotiate deep discounts or rebates with health plans. This incentive may put the drug in a better position or tier on the formulary, a list of drugs that a health plan will pay for. The best-tier drugs usually get the lowest copays.

“So raising list prices might lead to better access to prescription drugs because it would lead to large rebates,” said Ameet Sarpatwari, a professor at Harvard Medical School whose research focuses on The impact of laws and regulations on pharmaceuticals. and public health.

For consumers, this means the drug may cost less due to lower copays, despite an increase in list price.

Some prices have dropped

The prices of some medicines have been reduced.

Type 2 diabetes drug Januvia's decline was significant. It's down 42%, and both Ciaccia and Sarpatwari told me they were baffled by it.

“I didn’t have that on my bingo card,” Chasia said.

Januvia is one of 10 drugs whose prices will be negotiated in Medicare for the first time under the Biden administration as a result of the Inflation Reduction Act. But the new lower health insurance prices won't take effect until January 2026.

Merck said it was not lowering the price because of negotiations but wanted it to be closer to what insurance plans would pay after discounts and rebates.

As for how the new prices will impact consumers in the complex health care system, only time will tell.