Brand-name drug prices skyrocket
Prices for generics, however, are falling. Consumers who have the choice are crazy not to go for generic drugs.
A study released by Express Scripts found that prices for brand-name drugs rose 13.2% this year, more than six times the rate of inflation. Conversely, prices for generics went down by about 22% during that same time (from September 2011 to September 2012). The pharmaceutical industry, not surprisingly, is disputing the study's findings, saying it was skewed because it included expensive specialty medicines. A spokesperson for the Pharmaceutical Research and Manufacturers of America couldn't immediately be reached.
Express Scripts' report, though, should be a wakeup call even to the healthy, who wind up paying the costs of these drugs either through their health insurance premiums or tax dollars for entitlement programs.
"What it all points to is this: Patients choosing a market basket of brand-name medications instead of clinically equivalent generics are being charged a higher premium than ever before," according to the pharmacy benefits manager. "The financial incentive for both patients and their plan sponsors to switch to generics has never been greater."
Some people are forced to decide between paying their mortgage and their medicine. A study published in 2009 found that medical bills are a factor in more than 60% of personal bankruptcies. Overall health care expenditures hit more than $2 trillion in 2010, more than 10 times the $256 billion spent in 1980, according to the Kaiser Family Foundation. Rising drug costs are one of the main culprits behind all of these problems.
People who have multiple sclerosis know this issue all too well. Some medications to treat the neurological disorder can cost $30,000 a year. A study published in the journal Neurology found that these medications were very expensive and marginally beneficial, according to the New York Times. MS patients try to stretch their health care dollars by skipping doses and splitting pills.
"They have to give up vacations and certain kinds of family events because they just don't have the disposable income," said Dr. Nicholas LaRocca, vice president of health care delivery and policy at the National Multiple Sclerosis Society, in an interview.
The Express Scripts study also found that spending on specialty medicines has increased nearly 23% this year while spending on traditional medicines declined, which illustrates how competition can help keep prices down for everyone. Specialty medicines are also quite lucrative. As the New York Times noted, all but one of the new drugs approved in third quarter were specialty medicines, many of which were approved to treat advanced cancers that other treatments had failed to address.
I am fortunate that the cost to treat my condition averages about $15 every other month and is being managed effectively. Maybe one day, a big pharmaceutical company will develop an expensive blockbuster treatment, but I will cross that bridge when that happens. Maybe like millions of other Americans, I will buy my medications from low-cost Canadian pharmacies.
--Follow Jonathan Berr on Twitter @jdberr. Adds details on MS
More from Money Now
I am a physician. The healthcare system in the USA is the most expensive in the world. While it is good, it is far from the best in the world. Why? For profit health insurance and procedure based physician reimbursement. It is not that complicated.
Healthcare that is focused on maintaining health rather than treating end stage disease is not a priority. Those without insurance put off care until it is expensive and this ends up on the public dole. This is an expensive tragedy.
Pharma invests billions in new drugs and the American health consumer largely pays for it while the world benefits. A SINGLE patient in a clinical drug trial I have been involved with cost the study in excess of $25,000. It is very costly. Republicans and their special interest groups largely represent Pharma. It is BIG money. I personally paid less than two Euros in Europe for the exact same medicine from the same manufacturer that costs $38 dollars in the USA.
Healthcare issues in this country are very complex and in need of reform. Don't blame Democrats or Republicans for the cost of pills - it just doesn't make sense and stinks of ignorance.
This is a bit too negative MSN......... please have a big glass of koolaid and re-write this with a postivie spin........
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
While caffeine unquestionably improves focus, it blocks the ability to let the mind wander and form original ideas.
- Western wildfires raise the question of who pays
- 'The Wolf of Wall Street' is set to prowl again
- What vintage aircraft fly on: Donations, enthusiasm
- Obamacare surprise: Young people want coverage
- Urban Outfitters pulls drug-themed gear
- Donald Trump rakes in millions selling name to world
- EA's Simpsons game triggers gun fans' ire
- George Zimmer vs. Men's Wearhouse over firing
- New $25,000 rifle is fully loaded -- and then some
[BRIEFING.COM] Equities ended on their lows with the S&P 500 down 1.4%.
The S&P entered today's session with a week-to-date gain of 1.5% as investors expected reassuring words from today's Federal Open Market Committee Statement.
Stocks traded with slim losses until this afternoon's FOMC Statement and subsequent comments from Chairman Bernanke sent equities and Treasuries to their lows while also providing a significant boost to the dollar.
Today's Statement was ... More
More Market News
Plus, after much ado, Softbank is oh-so-close to acquiring Sprint.