This Year, Drug Prices Are Rising Rapidly
In the first six months of 2019, prescription drug costs are rising rapidly, despite promises from legislators and the Trump administration to reduce prices, and underscoring how important it is to take action so consumers can access their medicines.
This year over 3,400 drugs have seen their prices increase, which is 17% more than the 2,900 drug price increases at this point last year. And the average increase is 10.5%, or five times the rate of inflation. For some medicines, the price hikes have been much higher. The costs of forty-one drugs went up by over 100%. Guanfacine 2mg, a tablet used to treat ADHD, rose 118%, and one pain reliever/cough medication saw its price increase by 326%. And for one version of the antidepressant Prozac, the cost went up by 879%!
These 3,400 drugs are a relatively small share of the overall prescription drug market. But a lot of patients rely on these medicines to stay healthy, and the price increases are often devastating for them. 80% of Americans believe that drug costs are unreasonable and many Americans cannot fill their prescriptions because of high prices. Still others barely manage to buy medicines by cutting back on basic necessities, going through their savings, or depending on the kindness of strangers. In recent years, it has become common for people who need help paying for drugs or healthcare to start GoFundMe campaigns.
Costs are rising for many reasons: the lack of effective competition for many generic and brand-name drugs. patent abuse by drug companies that prevents cheaper generic drugs from coming to market, price gouging by drug companies and pharmacy benefit managers (PBMs), perverse incentives that promote the use of more expensive drugs, and the rebates that PBMs extract and fail to pass through to consumers. There are additional causes as well.
This is not just or sustainable. The rising costs of these medicines further underscore how big a critis this is. America needs swift action to lower prescription drug prices and rein in drug companies and PBMs. We hope that major legislative packages will be unveiled soon after the 4th of July, that they will be strong, and that they will be swiftly passed by Congress.