Fixed-dose combination and single active ingredient drugs: a comparative cost analysis

Abstract

Background: Fixed-dose combination (FDC) drugs are formulations of two or more active ingredients. Objectives: To assess the pricing structure and price difference of all US FDA-approved FDCs and single drugs included in the combination. Methods: Data were collected from the FDA Orange Book and Drugs@FDA. Average Wholesale Price (AWP) unit price data were derived from The Red Book. Results: The FDA approved 117 FDC. The average AWP difference percentage between the FDC and the sum of the single drugs in the FDC is 84.9 ± 26.2%, and varied by therapeutic class (p < 0.001). The FDC AWP averaged 83.3 ± 23.4% of the single drug AWP sum when there are no generics, and 95.1 ± 42.3% (p < 0.01) when there are two generic single active ingredients in the FDC. Conclusions: The price difference between FDC and single active ingredients in the combination is correlated with the therapeutic class, the year of FDC approval, and the number of single ingredients in the combination that have generics.

Keywords:

• average wholesale price
• drug approvals
• fixed-dose combination drugs
• Food and Drug Administration

Acknowledgements

The authors appreciate the comments and suggestions provided by three anonymous reviewers.

Financial & competing interests disclosure

The authors have no relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert testimony, grants or patents received or pending, or royalties.

No writing assistance was utilized in the production of this manuscript.

Key issues

• US FDA approvals of fixed dose combination (FDC) pharmaceuticals significantly increased since 1980. The FDC average wholesale price unit price also increased significantly over time.

• Pharmaceutical companies’ pricing strategy varies depending on the therapeutic class and the FDA review process (priority vs. standard review).

• Pharmaceutical companies setup the price at market entry of FDC drugs at the same level of the costliest single active ingredient in the combination to shift demand from single active ingredients facing generic competition toward new FDC drugs.

• Price differences between FDC and single active ingredient pharmaceuticals are significantly correlated with the therapeutic class, the year of FDA approval of the FDC, and the number of single ingredients in the combination that have generic formulations.