Increasingly criticized for high drug prices, pharmaceutical companies have limited their growth this year. Prescription drug manufacturers typically increase their recommended prices in January. However, in January 2022, pharmaceutical companies raised prices for fewer items than a year earlier, a study by investment firm Raymond James & Associates showed.
In addition, prices increased by 10% or more only in 5.5% of cases, while in 2020 and 2021 – in 15 and 20% of cases, respectively. However, median growth has changed little compared to last year and amounted to 8.9%, which is significantly higher than the inflation rate (about 2%).
Not all companies are holding back drug price increases
Most recently, Marathon Pharmaceuticals announced that the cost of an annual course of treatment for muscular dystrophy will start at $89,000. Before Marathon received approval to market the drug in the US, Americans could buy it in other countries for $1,600 per year. A barrage of criticism prompted Marathon to postpone its market launch.
Just six months after the EpiPen allergy drug scandal (Mylan sold it for $609 a pack of two ampoules), Kaleo decided to sell its competitor, Auvi-Q, for $4,500. Kaleo says it has found a way to get the drug free for most patients, but not for insurance companies. Mylan started selling a generic version of her product for $300. Many Americans even had to take payday loans to afford medical treatment. The popularity of this product is due to accessibility and instant funding. For example, to apply for payday loans online Tennessee, you only need to have a government-issued ID, a steady income and a bank account in your name. The funds can be used for whatever purpose, including the purchase of medication. Applications are processed online around the clock, so you have the opportunity to get a loan even late at night. If approved for a loan, you should expect to have the funds in your bank account within a few hours. There are minor differences related to payday lending in each city. For example, there are 282 lenders that are able to provide payday loans Memphis TN and 123 companies that are licensed to isuue payday loans Chattanooga TN. Follow the given links to get acquainted with lending policies in your city, read testimonials posted by genuine borrowers, and check out lenders’ ratings. Keep in mind that payday loans are only suitable for short-term money difficulties.
At the same time, even if the price of any drug rose by no more than 10%, the total cost of purchasing it could increase by hundreds of millions of dollars. For example, AbbVie last year earned $10.4 billion in the United States from sales of the arthritis and psoriasis drug Humira. An increase in its value of 8.4% means that additional expenses for its acquisition in the United States will amount to $850 million if it is used in the same way. widely, explains Raymond James, Elliot Wilbur’s analyst.
AbbVie said Raymond James’s calculations do not take into account discounts that resellers may receive. However, end users (insurance companies and some patients) may in some cases have to pay the full price or close to it.
Allergan CEO Brent Saunders said his company would only get 2-3 percentage points (in line with inflation) of an average 7.4% increase in prices for its products in January.
The companies are holding back price increases for fear of irritating the public, analysts said. Manufacturers are sticking to what they think the market will hold up: close to 10%, but one-digit growth, Wilbur said.
In addition, pharmaceutical companies hope they will be allowed to directly negotiate prices with the agency responsible for purchasing drugs for government insurance programs. The fact that such an idea is supported by US President Joe Biden was previously said by the press secretary of the White House, Sean Spicer. At the same time, at a meeting with top managers of pharmaceutical companies in January, Joe Biden called drug prices “skyrocketing” and promised to take measures to reduce them.
Overall, Raymond James estimates that US manufacturers raised prices for 2,353 prescription drugs in January 2022 – about a quarter less than a year earlier. In the pharmaceutical industry, “a price race has replaced innovation,” said Regeneron Pharmaceuticals CEO Leonard Schleifer in an interview. “If we continue this madness, the government will be forced to intervene,” he warned.