According to data analysed by healthcare research firm 3 Axis Advisors, drugmakers such as Pfizer, Sanofi, and Takeda Pharmaceutical plan to hike prices in the United States on over 500 medications in early January.
The research indicated that the costs of more than 140 prescription brands, excluding variations in dosage and formulation, will increase in the upcoming month.
The anticipated price increases coincide with the pharmaceutical industry's ongoing battle with rising production and inflation costs, as well as preparations for the Biden Administration's September announcement of dramatically reduced prices for ten expensive pharmaceuticals.
Beginning in 2026, the government's Medicare health programme will have the authority to directly negotiate prices for a limited number of pharmaceuticals under President Joe Biden's Inflation Reduction Act (IRA).
Concerns are also mounting over new supply chain disruptions brought on by an extended conflict in the Middle East, which is forcing shippers to divert or stop traffic from the world's busiest East-West trading route—the Red Sea.
The data also indicates that at least 15 medications would see price reductions in January from three businesses, including GlaxoSmithKline (GSK.L), which announced last week that it would be slashing costs on some asthma, herpes, and anti-epileptic treatments for 2024.
The reductions follow numerous firms' earlier announcements of insulin price reductions this year, which were made in an attempt to avoid fines that would have been imposed under the American Rescue Plan Act of 2021 if the companies had maintained high pricing.
According to the law, pharmaceutical companies must reimburse the Medicaid programme if prescription prices rise faster than inflation. Starting in January 2024, these reimbursements may even exceed the drug's real net cost.
"Every major former blockbuster insulin is going to get thrown under the tires of this policy," 3 Axis president Antonio Ciaccia said.
Eli Lilly intended to increase the price of its well-known diabetic medication Mounjaro by 4.5% on January 1st, and reduce the cost of its Humalog and Humulin insulins by 75.8% and 70%, respectively, on December 30th, according to a note from Truist analyst Robyn Karnauskas. The data from 3 Axis did not incorporate these modifications.
List prices are affected; rebates to pharmacy benefit managers and other discounts are not included in this.
There were no comments from the pharmaceutical companies.
Since they came under fire for implementing too many price rises in the middle of the previous decade, several major participants in the sector have followed the norm of drugmakers keeping increases at 10% or below.
High rates of inflation haven't deterred pharmaceutical companies from raising the prices of their already-released products at an accelerated pace.
Ciaccia stated that he had believed last year that "you would see the proverbial pedal to the metal" because to inflation and worries about the U.S. drug price bargaining plan in the IRA. However, the last five years have essentially been the same."
Data from 46brooklyn, a 3 Axis-affiliated non-profit that studies medicine prices, shows that median price increases have been constant at about 5% since 2019.
Pfizer has announced the highest price rises in January for at least the past two years; they are responsible for more than 25% of all scheduled price increases for pharmaceuticals.
The pharmaceutical company, headquartered in New York, plans to raise the cost of 124 medications and add another 22 medications at its Hospira division.
Pfizer and Hospira have announced plans to increase the pricing of thirty and six branded medications, respectively, excluding variations in dosage and formulation.
With 53 price increases planned thus far, Takeda-owned Baxalta disclosed the second-highest number of price increases. Belgian drugmaker UCB Pharma is the next in line, with plans to raise prices on 40 individual products.
Next month, the prices of six branded medications from UCB and eight branded medications from Baxalta will increase following a discount on various dosages and formulations.
Sanofi, which earlier this year promised to reduce the cost of the majority of its prescribed insulin products by 2024, would noticeably increase the cost of its rabies, yellow fever, and typhoid fever vaccinations by 9% apiece in January.
January, which has historically been the largest month for drugmakers to hike prices, is probably going to see more announcements about drug costs.
Based on data released by 46brooklyn, pharmaceutical companies increased the price of 1,425 medications in 2023 as opposed to 1,460 in 2022.
Price hikes for newly introduced pharmaceuticals have reached record levels, despite drugmakers reducing their increases for older drugs.
Newly released medications cost more than $220,000 in 2022 compared to about $180,000 in the first half of 2021, indicating a more than 20% increase. This is consistent with a research on drug pricing published in JAMA that found that, between 2008 and 2021, the cost of new drugs in the United States increased by 20% a year.
(Source:www.reuters.com)
The research indicated that the costs of more than 140 prescription brands, excluding variations in dosage and formulation, will increase in the upcoming month.
The anticipated price increases coincide with the pharmaceutical industry's ongoing battle with rising production and inflation costs, as well as preparations for the Biden Administration's September announcement of dramatically reduced prices for ten expensive pharmaceuticals.
Beginning in 2026, the government's Medicare health programme will have the authority to directly negotiate prices for a limited number of pharmaceuticals under President Joe Biden's Inflation Reduction Act (IRA).
Concerns are also mounting over new supply chain disruptions brought on by an extended conflict in the Middle East, which is forcing shippers to divert or stop traffic from the world's busiest East-West trading route—the Red Sea.
The data also indicates that at least 15 medications would see price reductions in January from three businesses, including GlaxoSmithKline (GSK.L), which announced last week that it would be slashing costs on some asthma, herpes, and anti-epileptic treatments for 2024.
The reductions follow numerous firms' earlier announcements of insulin price reductions this year, which were made in an attempt to avoid fines that would have been imposed under the American Rescue Plan Act of 2021 if the companies had maintained high pricing.
According to the law, pharmaceutical companies must reimburse the Medicaid programme if prescription prices rise faster than inflation. Starting in January 2024, these reimbursements may even exceed the drug's real net cost.
"Every major former blockbuster insulin is going to get thrown under the tires of this policy," 3 Axis president Antonio Ciaccia said.
Eli Lilly intended to increase the price of its well-known diabetic medication Mounjaro by 4.5% on January 1st, and reduce the cost of its Humalog and Humulin insulins by 75.8% and 70%, respectively, on December 30th, according to a note from Truist analyst Robyn Karnauskas. The data from 3 Axis did not incorporate these modifications.
List prices are affected; rebates to pharmacy benefit managers and other discounts are not included in this.
There were no comments from the pharmaceutical companies.
Since they came under fire for implementing too many price rises in the middle of the previous decade, several major participants in the sector have followed the norm of drugmakers keeping increases at 10% or below.
High rates of inflation haven't deterred pharmaceutical companies from raising the prices of their already-released products at an accelerated pace.
Ciaccia stated that he had believed last year that "you would see the proverbial pedal to the metal" because to inflation and worries about the U.S. drug price bargaining plan in the IRA. However, the last five years have essentially been the same."
Data from 46brooklyn, a 3 Axis-affiliated non-profit that studies medicine prices, shows that median price increases have been constant at about 5% since 2019.
Pfizer has announced the highest price rises in January for at least the past two years; they are responsible for more than 25% of all scheduled price increases for pharmaceuticals.
The pharmaceutical company, headquartered in New York, plans to raise the cost of 124 medications and add another 22 medications at its Hospira division.
Pfizer and Hospira have announced plans to increase the pricing of thirty and six branded medications, respectively, excluding variations in dosage and formulation.
With 53 price increases planned thus far, Takeda-owned Baxalta disclosed the second-highest number of price increases. Belgian drugmaker UCB Pharma is the next in line, with plans to raise prices on 40 individual products.
Next month, the prices of six branded medications from UCB and eight branded medications from Baxalta will increase following a discount on various dosages and formulations.
Sanofi, which earlier this year promised to reduce the cost of the majority of its prescribed insulin products by 2024, would noticeably increase the cost of its rabies, yellow fever, and typhoid fever vaccinations by 9% apiece in January.
January, which has historically been the largest month for drugmakers to hike prices, is probably going to see more announcements about drug costs.
Based on data released by 46brooklyn, pharmaceutical companies increased the price of 1,425 medications in 2023 as opposed to 1,460 in 2022.
Price hikes for newly introduced pharmaceuticals have reached record levels, despite drugmakers reducing their increases for older drugs.
Newly released medications cost more than $220,000 in 2022 compared to about $180,000 in the first half of 2021, indicating a more than 20% increase. This is consistent with a research on drug pricing published in JAMA that found that, between 2008 and 2021, the cost of new drugs in the United States increased by 20% a year.
(Source:www.reuters.com)
