June 10, 2015
Generic Price Declines Ending; Increases More Than
1,000% for Some
Washington, D.C.—Generic drug prices have decreased consistently over the last 5 years or so, but that appears to be coming to an end, according to a new AARP report showing the smallest average annual decline since at least 2006.
The new Rx Price Watch Report released recently by AARP Public Policy Institute (PPI) shows significant price increases of as much as a 1,000% for some popular generic drugs. Yet, overall, retail prices for 73% of generic prescription drugs widely used by older Americans fell in 2013 by an average of 4%.
The new PPI report looked at the 2013 retail prices for 280 of the generic drugs most widely used by older Americans.
“Declining generic drug prices have helped many Americans’ pocketbooks, particularly older adults on fixed incomes,” said Debra Whitman, PhD, AARP executive vice president for policy. “Unfortunately, recent trends indicate that we may not be able to rely on these savings forever.”
The report found that 27% of the 280 drugs had retail price increases, with 11 drugs shooting up more than 30%. The average annual cost for a generic drug used for a chronic condition was $283, AARP revealed.
The biggest price increases were for doxycycline hyclate 100-mg capsules and doxycycline hyclate 100-mg tablets, 1,961.5% and 1,748.1%, respectively, according to the report. Other very substantial price rises occurred for methotrexate 2.5-mg tablets, 213.4%, and divalproex sodium, 500-mg tablets extended-release 24 hour, 193.3%.
With nearly two-thirds of older Americans using three or more prescription drugs a year, the report emphasizes that generic medications are still a good deal. Using the three generic drugs on a chronic basis in 2013 would have cost $849 annually, compared to $8,880 for brand name.
The report adds that more than 75% of all retail prescriptions filled in the United States are for generic drugs.
“Many brand name drugs have generic equivalents that are every bit as safe and effective but typically cost much less than their brand name counterparts,” said co-author Leigh Purvis, MPA, PPI Director of Health Services Research. “As more and more new brand name drugs and biologic drugs enter the market with extremely high prices, it will be more important than ever that people have generic medications to help with their budgets.”
For the report, AARP’s Public Policy Institute, in collaboration with the PRIME Institute at the University of Minnesota, developed a market basket of 280 generic prescription-drug products widely used by older Americans and analyzed retail price changes between 2006 and 2013, using data from the Truven Health MarketScan Research Databases. The medications include products used to treat common and often chronic health conditions, including high cholesterol, depression, diabetes, and hypertension.
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