Brand-Name Drugs Prices Skyrocket
Healthcare is expensive and prescription drugs account for one-tenth of every dollar spent on healthcare and drug companies are counting their pocketbooks as some of the brand-name drugs are skyrocketing. AARP’s first-ever analysis of retail price trends of prescription drugs finds prices for widely used brand name drugs soared in 2009, by over eight percent.
Brand-name prescription drug price rise hits the pockets of older people
If that isn't bad enough, it appears that the band-name medication that is being gouged, is widely used by older people. In fact, it far outpaced growth in the costs of other consumer goods and services for the year ending with March 2010.
According to report co-author Stephen Schondelmeyer, professor of pharmaceutical economics at the University of Minnesota, said the results “confirm yet again that drug manufacturers are raising prices far beyond what normal inflation is”.
“For the first time, we know that brand name drug retail prices are growing just as quickly as manufacturer prices,” said AARP Executive Vice President John Rother. “These are increases that hit the wallets of every American, whether through their own health care bills or the costs of programs like Medicare and Medicaid.”
The average price of 217 brand-name prescriptions most widely used by Medicare beneficiaries rose by 8.3 percent in the 12 months ending with March 2010, higher than any increase in the prior eight years. In contrast, the general inflation rate rose -0.3 percent for the same period. The brand name prescription drug that saw the biggest jump in retail price in 2009 was Flomax (0.4 mg capsule), which rose 24.8 percent.
Rother said, “Prescription drugs improve the lives of millions of Americans. But unless something is done to bring down their skyrocketing price increases, life-saving medicines will be out of reach for too many. The health care law made some progress by closing the Medicare doughnut hole, but Congress and the industry must bring more competition and transparency to the marketplace.”
"Something is out of whack here about no increases in the rest of the economy and very substantial [increases] with pharmaceuticals," Rother said. The pharmaceutical industry group, Pharma, declined requests for an on-camera interview with ABC news and refused to answer questions we submitted in writing. However, in a written statement, Pharma called the AARP report "distorted and misleading."
Rother concluded, “They are the most profitable part of the health care system, one of the most profitable in the country, and it looks like they’re doing this because they can, because no one’s stopping them, to maintain their profit goals.”