Prices of brand-name drugs in the US have doubled since 2011

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According to Express Scripts, the average price of brand-name drugs in the US has doubled in the past five years and has increased on average by 16.2% since 2015. Express Scripts, the largest pharmacy benefit management organization in the US, based its March 2016 report on prescription use data for members with drug coverage by the organization.

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The prices of specialist drugs, which includes drugs for rheumatoid arthritis, multiple sclerosis and cancer, increased the most (up 17.8% in 2015). This picture is different to the pattern of drug spending 10‒20 years ago, when the biggest spend was for traditional, mostly oral, small-molecule solid drugs, to treat heartburn, depression and diabetes.

In 2015, 37.7% of drug spending was for specialty drugs and this figure is expected to rise to 50%. Ironically, only 1‒2% of patients used these drugs in 2015. The high prices are attributed to lack of competition in the US market for those drugs.

Prices within the traditional drug category, however, have still increased significantly, with prices of diabetes medications increasing by 14%, partly based on increased drug usage and partly based on rising unit cost. This trend was also seen with oncology treatments, with prices increasing by 23.7%.

Although on average, prices of generics have decreased, in certain categories, prices of some generics have increased. This follows the upward price trend set by counterpart brand-name drugs. For example, in the heartburn category, 92.3% of medications were generic but their inflated prices shadowed the price of brand-name drugs within the category such as Nexium (esomeprazole), Dexilant (dexlansoprazole) and Prevacid (lansoprazole).

Treatments for skin conditions increased by 27.8%, due mostly to increases in unit costs but also due to industry consolidation through mergers and acquisitions reducing market competition.

The report highlights ‘captive pharmacies’ as a factor driving up prices. These pharmacies are owned or operated by pharmaceutical manufacturers and tend to promote their own drug rather than generic or other low-cost drugs.

The data published by Express Scripts data support similar findings by Truveris OneRx National Drug Index, which found that brand-name drugs rose by 14.8% in 2015.

In the US presidential electoral campaign, both Democrats and Republicans have promised to pressurize large pharmaceutical companies to reduce prices of brand-name medicines.

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Source: Express Scripts

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