Oct 8, 2019

"Unsupported" drug price hikes cost Americans billions

AbbVie's Humira manufacturing plant in Puerto Rico. Photo: AbbVie

Price hikes on 7 prominent drugs — all of them above the rate of medical inflation, none supported by clinical evidence — cost Americans more than $5 billion over the last two years, according to a new report from the Institute for Clinical and Economic Review.

Why it matters: Drugmakers weren't hiking prices because their medications were safer or more effective than when they were approved. They did it because they could.

By the numbers: Here are the drugs (and manufacturers) highlighted in ICER's report, along with the increase in net spending attributable to each drug's price increase.

  • Humira (AbbVie): $1.9 billion
  • Rituxan (Roche): $806 million
  • Lyrica (Pfizer): $688 million
  • Truvada (Gilead Sciences): $550 million
  • Neulasta (Amgen): $489 million
  • Cialis (Eli Lilly): $403 million
  • Tecfidera (Biogen): $313 million

Those figures aren't just the dollars Americans spent on drug copays and other out-of-pocket costs. They mostly reflect the higher amounts people paid through health insurance premiums and taxes.

A common thread: Most of those drugs have faced competition from generics or biosimilars. Erin Fox, a pharmacotherapy professor at the University of Utah, said in a tweet that is "a typical time to jack up prices without adding value."

The other side: ICER published an appendix in the report, which has been in the works for months, that included rebuttals from the pharmaceutical firms in question.

  • The companies criticized the analysis for not factoring in the "value" of their drugs and lives saved, but ICER responded that "new evidence must provide information different from what was previously believed in order to support a price increase."

Go deeper

New drugs are launching with ever-higher prices

Illustration: Eniola Odetunde/Axios

The average launch prices for new brand-name drugs have skyrocketed over the past decade, according to an analysis from drug research firm 46brooklyn.

Why it matters: The U.S. prescription drug market increasingly has thrived on high initial price tags and subsequent increases. That has resulted in higher premiums and out-of-pocket costs for new drugs, as well as more expensive generics.

Go deeperArrowOct 16, 2019

The struggle to evaluate drugs

Illustration: Aïda Amer/Axios

The Institute for Clinical and Economic Review and the pharmaceutical industry don’t even agree on what should be considered relevant evidence when deciding if a drug is safe and effective.

Why it matters: "This debate on what constitutes high-quality, 'real-world' evidence is not going away," said Walid Gellad, a pharmaceutical expert at the University of Pittsburgh.

Go deeperArrowOct 9, 2019

A drug pricing method that values the price of a life gets new attention

Illustration: Eniola Odetunde/Axios

A drug pricing model used by other countries but long opposed by drugmakers in the U.S. is getting new attention amid the political debate over drug prices, the Wall Street Journal reports.

How it works: The method, pushed by the Institute for Clinical and Economic Review, "puts a dollar figure on a year of healthy life, calculates how much health a drug restores to a sick patient, then prices drugs accordingly," per the Journal.

Go deeperArrowNov 5, 2019