According to new research released by AARP’s Public Policy Institute (PPI), list prices for the top 25 Medicare Part D drugs have increased by an average of 226% since first entering the market. The study notes that this increase is far beyond the rate of general inflation and that more than half of the current list prices of the top 25 drugs are due to price increases after the products first entered the market:
“Brand-name drug prices have been increasing faster than the rate of general inflation for decades, and drug companies have increasingly relied on such price increases for revenue growth.”
The study also found that time on the market impacted changes in prices as well:
“…the average lifetime price increase for the seven products on the market for less than 12 years was 58 percent, whereas the average lifetime price increase for the five products on the market for 20 years or longer was 592 percent.”
Finally, AARP’s research highlights the role of post-market entry price increases on today’s prices:
“…on average, nearly 60 percent of the current list price for the 25 top drugs is due to price increases after the product entered the market.”
Everyone should be able to get the medications they need at a cost they can afford. Drug list prices and price increases are set and controlled by Big Pharma—and only Big Pharma. Should they choose, they could lower prices for Americans today. Instead, they continue to raise prices year after year—even several times a year—making health care more expensive for everyone.
Read AARP Public Policy Institute’s Spotlight on Medicare Part D drugs.
Discover more AHIP resources on High-Priced Drugs.
AHIP is the national association whose members provide health care coverage, services, and solutions to hundreds of millions of Americans every day. We are committed to market-based solutions and public-private partnerships that make health care better and coverage more affordable and accessible for everyone. Visit www.ahip.org to learn how working together, we are Guiding Greater Health.