Drug price increases have been a growing concern worldwide for many years. We have seen this in the pain management arena where aggressive marketing of new and expensive opioid dosage forms has markedly increased the cost of pharmacotherapy. Even in developing countries, some American and European pharmaceutical manufacturers have aggressively marketed new and expensive proprietary formulations to federal health ministries to replace inexpensive morphine solutions and tablets.
In the United States, generic equivalents of off-patent drugs have traditionally been less expensive alternatives to the innovator products. But the cost of many generic drugs has increased markedly. A recent survey of drug prices by David Belk, MD, compared quarterly National Average Drug Acquisition Cost (NADAC) prices (the average price all retail pharmacies pay for each medication) of the majority of generic prescription medications since October 2012.Citation1 He surveyed the prices of 1240 generic listings (including different doses and preparations) of over 400 separate medications and tracked these prices each quarter from October 4, 2012, through January 7, 2015, to determine how the price of each medication changed from the previous quarter and in total. Dr. Belk noted that about half of the generic drug prices decreased, but 314 of the listings went up at least 50% in price, 240 of the listings (20%) at least doubled in price, 87 went up at least 5 times in price, and 42 of them went up 10 or more times in price since October 2012.
The fiasco that brought this issue to the general public's attention was the widely publicized and disgraceful price gouging by Turing Pharmaceuticals. Turing purchased the marketing rights to Daraprim (pyrimethamine), an off-patent antiparasitic agent that can be life-saving in immunosuppressed patients. Then, in September, Turing announced a price increase for pyrimethamine from $13.50 a tablet to $750, an increase of over 5000%. Turing is not a member of the Pharmaceutical Research and Manufactures Association (PHRMA), and PHRMA was highly critical of Turing's action.
But what Turing did is not unique. Fortune magazine reports that other companies have purchased older, off-patent drugs and significantly raised their prices. For example, Valeant Pharmaceuticals acquired the cardiac drugs Isuprel and Nitropress earlier this year and subsequently raised the prices by 525% and 212%, respectively.Citation2 Valeant is a member of PHRMA.
The Pharmaceutical Strategic Alliances (PSA) Pharmaceutical Strategy Conference is a meeting at which pharmaceutical and biotech industry leaders address fundamental challenges facing their industries. At the 2015 conference held in New York at the end of September, Michael Hayden, the global head of research and development at Teva Pharmaceutical Industries Ltd. urged responsibility in drug pricing given public resentment of rising health care costs, especially following the Turing price increase. Teva is the world's largest generic pharmaceutical manufacturer. Although innovation should be fostered, Hayden said, “Our goal is not to make money and disrupt the whole healthcare system.”3
The industry argues that drug price increases are necessary to fund ongoing research and development. There is truth in that statement, and R&D costs are reflected in the pricing of new drugs. But does that justify large price increases in drugs that are decades old and long off-patent?
Industry spokespeople and some policy analysts attribute the price increases to suggestions from the current federal administration that price controls for pharmaceuticals may be forthcoming. Although the market has strongly resists such controls, the recent Turing price increase may well be the straw that breaks the camel's back and precipitates controls being imposed.
For now, it would be useful for clinicians to be aware of what the drugs they use cost and to remain be aware of drug price increases. When clinically appropriate, we should adjust patient care to use the most cost-effective medications because the market does respond to utilization changes.
Declaration of interest: The author reports no conflict of interest. The author alone is responsible for the content and writing of the paper.