Drug Makers Increased Prices By Average Of 7.4% In 2007 For Medications Most Commonly Prescribed To Elderly, AARP Study Finds

Main Category: Pharma Industry / Biotech Industry
Also Included In: Seniors / Aging
Article Date: 06 Mar 2008 - 11:00 PDT

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Drug prices for brand-name medications most commonly prescribed to the elderly increased by an average of 7.4% in 2007 -- about two-and-a-half times the rate of inflation, according to an AARP study released on Wednesday, the AP/Contra Costa Times reports. For the study, AARP tracked wholesale drug prices of 220 brand-name medications. According to the study, prices increased for all but four drugs in 2007, with most exceeding the rate of general inflation. The drug with the largest price increase -- 27.7% -- was Sanofi-Aventis' sleep aid Ambien, while the price of Merck's cholesterol drug Zocor did not change.

According to AARP, which has tracked drug prices since 2002, wholesale prices for drugs have increased since the Medicare prescription drug benefit began on Jan. 1, 2006. In the four years before the benefit began, wholesale drug prices increased by between 5.3% and 6.6% annually, AARP said. Organization officials say the public outcry over prescription drug prices diminished after the drug benefit took effect because the government was covering most of the cost for beneficiaries' drugs. AARP Policy Director John Rother said, "Unfortunately, many manufacturers have taken the absence of an outcry as a green light to go ahead and raise prices even more."

The Pharmaceutical Research and Manufacturers of America said the study does not reflect the true amounts consumers pay for drugs, nor does it account for generic drugs, which have slowed the growth in drug prices. According to PhRMA Senior Vice President Ken Johnson, since 2000, prescription drug prices have increased at a slower rate than overall medical inflation. Johnson said federal government figures showing a 3.7% annual increase in medicines versus a 4.3% increase for overall medical inflation are more accurate because they include brand-name and generic drugs, which represent what "consumers actually buy -- rather than the few selectively highlighted by AARP" (Freking, AP/Contra Costa Times, 3/5).

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