More Evidence for Concern about Drug Pricing

Analysts at Bloomberg looked at price changes for Medicare’s Part D program for over 2000 drugs from 2013 through 2017.   (Bloomberg Analysis)   The median price increase per dose was 28%, with a very wide range and a lot of drugs in the 100% plus area.  22 drugs experienced 500% or greater price growth in that period.  Under Part D’s current benefit design, that can be a real inhibitor for patients, as the more drug spending they have, the higher their out-of-pocket costs are likely to be.  In total Medicare spent about $154.8 billion on Part D in 2017 and saw an average 10.6% spending increase annually from 2013 to 2017.  Just 77 drugs accounted for half of total spending in 2017.  Some drug makers are utilizing what at best might be described as unusual pricing behavior, for example, Thiola, used for a recurring kidney stone disease, had a 2400% price increase per dose, from $1.21 to $29.17.   That might more accurately be referred to as rapacious pricing behavior.  The company said the price hadn’t increased for three years (and? so what)  and claimed it was “investing” in the product.  Load of crap.  Interestingly, a competitor to this product had the second-highest increase.  Hmmm, where are the antitrust investigators, or is it just me who thinks this could be suggestive of collusion.  Even generics weren’t immune.  Generic sodium acetate, while admittedly still cheap, went from one cent a dose to six cents.  How do you explain that?  Congress is investigating all kinds of supposed fixes for drug pricing.  The obvious one is what I keep beating the drum for–drug pricing is solely dependent on a government-granted monopoly; so the government should attach pricing constraints to those monopolies.