New year, new (higher) drug prices
Surging drug prices in the United States are a thorny yet key bipartisan issue as another presidential election beckons. While US President Trump struggles to make good on his promise to lower drug prices, the industry, which has long thrived in its laissez-faire ecosystem, has persistently argued that government intervention will stifle innovation. And now, as the new year kicks off, a cadre of drugmakers has quietly inflated prices on more than 250 drugs, according to a Reuters report.
From Gilead to Pfizer, big pharma has clicked upgrade on their sticker prices — largely by the mid-single-digit percentage increases. As the spotlight on drug pricing intensified, with patients, policymakers, and politicians decrying the magnitude and frequency of hikes, a raft of drugmakers previously pledged to not raise their prices by more than 10% annually.
British drugmaker GSK is set to raise US prices on more than 30 drugs in the range of 1% and 5%, Reuters reported, citing data from healthcare research firm 3 Axis Advisors.
Among the Pfizer hikes, there are notable increases on a trio of blockbusters — the cancer drug Ibrance, the blood-thinner Eliquis and the vaccine Prevnar. The US drugmaker has lifted its prices by 5%, 6%, and 7.3% respectively in the United States. The company intends to boost US prices on around 27% of its portfolio by an average of 5.6%, the wire service reported.
Evercore ISI’s Umer Raffat offered a snapshot of Pfizer’s hikes, among other key drugmakers, in recent years in a note published on Wednesday.
Bristol-Myers, which swallowed Celgene in a $74 billion deal last year, also increased the prices of 10 drugs on Wednesday, including a 1.5% hike on its immunotherapies Opdivo and Yervoy. Celgene’s cash cow Revlimid was given a 6% raise, Reuters reported, adding that the company has promised not to issue hikes higher than 6% this year.
Gilead, Biogen, Lilly, and Teva also took a range of hikes on some key drugs — all up to and equal to 6%.
Amgen, Merck and the prices of some other key drugs from drugmakers already featured above are expected in the coming days and months, Raffat noted.
Lawmakers left, right and center all argue drug prices in the United States are too high — and the industry holds the crown for the least favored sector by Americans, falling behind the federal government itself — but so far nobody can agree on just how to make the US health care system great again. Last month, the HHS opened the door to a policy that allows for the importation of drugs from Canada.
The Democrats’ drug pricing bill — HR 3, unveiled by Speaker Nancy Pelosi in September — was recently passed by the House and could compel manufacturers to comply with the prices set by the HHS, or face an excise tax of up to 95% of sales, which in turn could trigger financial losses due to drug sales. The Senate, with a Republican majority, is unlikely to endorse it.
The GOP has cooked up its own legislation. The 350-page bill, HR19, proposes creating the role of a ‘chief pharmaceutical negotiator’ to advocate on behalf of American patients in trade agreements with respect to prescription drug prices. In addition, the bill also seeks to limit annual out-of-pocket costs for Medicare beneficiaries; requires insurance companies to make information about drug prices transparent at doctor’s offices; and ‘streamlines’ the regulation of over-the-counter products.