Big Pharma’s January Price Increases and Price Hikes on Popular Medications for Seniors Provide Reminder Drug Companies Set the Price

In case you missed it, Big Pharma kicked off the new year with price increases on hundreds of brand name drugs. These price hikes are nothing out of the ordinary, as drug companies consistently increase the price of the drugs they create - at rates higher than the rate of inflation. These increases, despite what Big Pharma would have policymakers believe, are not driven by anything other than big drug companies' aiming to maximize their profits.

That is because drug companies set the price - and the price is the problem when it comes to Americans facing difficulty affording their prescription drugs. Read coverage of Big Pharma's price hikes at the beginning of the year in Reuters, Fierce Pharma, Quartz, and InsideHealthPolicy.

On the heels of Big Pharma's latest round of price hikes, AARP released a new analysis that found, "The 25 brand drugs with the most Medicare Part D spending … have had their list price increase an average of 98 percent over their lifetime."

In other words, big drug companies essentially doubled prices on the prescription drugs most often needed by seniors since they first entered the market.

High prices on the medications in the report, including GLP-1 drugs and breast cancer treatments, resulted in nearly $50 billion in spending for the Medicare Part D program.

Big drug companies determine the price, decide when to increase the price, block competition to keep the price high, and increase sales by spending billions of dollars each year advertising high-priced products to consumers.

Now, Big Pharma is trying to pull off a huge money grab, asking Congress to intervene in the private health care marketplace to increase drug companies' pricing power. Their plan would boost Big Pharma's profits, and hike health care costs for everyone else, by undermining pay-for-performance incentives that help pharmacy benefit managers (PBMs) negotiate against drug companies to deliver savings for health plan sponsors and patients - American employers and families.

These pharma-backed policies would do nothing to lower prescription drug prices.

PBMs only retain six percent of the drug dollar - or six cents out of that $1 spent on prescription drugs at the retail pharmacy - while providing significant savings and value for patients, employers, and taxpayers.

Learn more about Big Pharma's self-serving agenda HERE.

###

PCMA is the national association representing America's pharmacy benefit companies. Pharmacy benefit companies are working every day to secure savings, enable better health outcomes, and support access to quality prescription drug coverage for more than 275 million patients.