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US drug makers have imposed big price rises for top selling drugs, study finds

BMJ 2016; 353 doi: https://doi.org/10.1136/bmj.i1944 (Published 05 April 2016) Cite this as: BMJ 2016;353:i1944
  1. Michael McCarthy
  1. Seattle

From 2011 to 2014 drug companies have increased the prices of four of the top 10 drugs sold in the United States by more than 100% and the prices of the remaining six by more than 50%, an analysis by Reuters has found.1

According to the news agency, the biggest increase was by AbbVie Inc, which raised the price of arthritis drug Humira (adalimumab) by more than 126%. The next highest price increases were by Amgen, maker of the arthritis drug Enbrel (etanercept), and Teva Pharmaceuticals, maker of the multiple sclerosis drug Copaxone (glatiramer acetate). Both companies raised the prices of their drugs by 118%. AstraZeneca came in fourth with a 113% price increase for its cholesterol drug Crestor (rosuvastatin).

Of the 10 drugs the increase was smallest for AstraZeneca’s proton pump inhibitor Nexium (esomeprazole), whose price rose by 54%. Overall, revenue from the top 10 drugs went up by 44% over the five year period even though prescriptions fell by 22%, Reuters said.

PhRMA, the Pharmaceutical Research and Manufacturers of America, said that the report was misleading because it focused on list prices and ignored prices negotiated by insurers and pharmacy benefit managers. These purchasers had “the ability to demand significant discounts and rebates, establish formularies and incentivize patients to use lower cost generic alternatives,” the industry group said.

In a statement, Amgen defended its pricing strategy, noting that the revenue of products like Enbrel allowed the company to invest in research into new products and new indications for existing products. “At Amgen, we price our products to reflect the economic value that is delivered to patients, providers, and payers; the unmet medical need; the size of the patient population; the investment and risk undertaken; and the need to fund continued scientific innovation,” the company said.

Drug prices have become a growing concern in the US. In a recent poll 77% of the public said that making sure that high cost drugs for chronic conditions such as HIV, hepatitis, mental illness, and cancer were affordable for those that needed them should be a top priority for congress and the president.2

The problem was highlighted last year when two companies sparked a congressional inquiry3 after they boosted prices for older drugs after acquiring the rights to them. One company, Turing Pharmaceuticals, raised the price for the 60 year old toxoplasmosis drug pyrimethamine (marketed as Daraprim) by 5000%. The other company, Valeant Pharmaceuticals, increased the price of two commonly used heart drugs, Nitropress (nitroprusside sodium) and Isuprel (isoprenaline), by 650% and 820% respectively.

More recently Valeant doubled the price for Seconal (secobarbital sodium)—a drug commonly used by terminally ill patients to end their lives in states that allow aid-in-dying—boosting the cost for these patients from $1500 to $3000. According to a report in the Seattle Times,4 the move prompted physicians in Washington state, where physicians can legally prescribe lethal doses of drugs to the terminally ill, to turn to a compounding pharmacist to create a less expensive alternative. The cost of drugs used in aid-in-dying is not covered by private or government insurance plans.

Critics said that Valeant had increased the price to profit from the passage of an aid-in-dying law in California, which takes effect this year, but the company said that there was no truth to this accusation. “The price increase for the drug occurred shortly after Valeant acquired it, and months before California’s assisted suicide law passed,” the company said in a statement. “The suggestion that Valeant raised the price to take advantage of a law that had not yet passed, for a use for which the drug is not even indicated, defies common sense.”

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