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Drug Prices: A Threat To Innovation

posted by Alicia Caramenico

on February 27, 2015

An article today from Bloomberg Business gives some good news and bad news on the pharmaceutical front. New drugs are hitting the market, offering patients additional treatment options. But many experts are concerned that the exorbitant prices of these medications will jeopardize medical innovation as we know it.

The more than 30 cancer drugs that got approved from 2010 to 2014 carried price tags of $5,000 a month or more. Making bad news worse, “The conflict threatens to slow the pace of future discoveries and patients’ access to the drugs,” Bloomberg Business reported.

Just take a look at the chart below showing that the number of cancer drugs soared along with their price tags – from five new drugs introduced at $129 a month during the late 1970s to 34 new drugs introduced at a price of $10,059 a month from 2010 – 2014.

cancer_bloomberg-1

The drug pricing threat to innovation and sustainability, as we’ve noted before, goes well beyond treatments for cancer. Truveris, a drug pricing and benefits analytics firm, found that the average price of more than 5,000 commonly used prescription medicines jumped 11 percent in 2014. As Bloomberg noted, that is 14 times higher than U.S. consumer inflation.

Bloomberg has the last word on this front:

“The bottom line: Drugmakers are enjoying a rush of new medicines, but their high costs threaten the pace of innovation.”