Generic Drug Prices Run AMOK!

And you probably thought you could still afford those ‘cheap’ generic drugs…

You may have noticed recent increases in generic drug prices. More than 85% of all prescriptions are for generic drugs. What is a generic drug? According to the FDA, generic drugs are copies of brand-name drugs and are the same as those brand name drugs in dosage form, safety, strength, quality, performance characteristics and intended use. And they have always been much cheaper than brand name drugs.

Truthfully, I had not paid much attention to this, although I saw some of the reports. But when it hit close to home… I have used a generic prescription ointment to treat my eczema. In October 2014 the retail cost of my prescription was about $47, and with my copay I paid much less. In January 2015 when I went to refill the prescription, I was told the retail price was now $500! That’s a 1,000% increase.

So I was off to Google to find out what’s going on. No problem—there were hundreds of articles, surveys, editorials and even an inquiry by The House Committee on Oversight & Government Reform, (created in 1816). You know we’re in good hands when you hear, “We’re from the government and we’re here to help you.”

Reports in The New York Times and an article in Slate Magazine titled Drug Bust, laid out some of the sad facts. It seems that in the past couple of years, many generic drugs have increased in price by 1,000%, 5,000%, or even 8,000%! 

Why, pray tell, is this happening? It seems there are several reasons, sort of. There have been shortages of some generic drugs and that always pushes prices up. With generic drugs the research and development costs have long since been recovered. I’m thinking that greed, a good thing according to Gordon Gekko, may also be a factor. But that’s just a cynical guess on my part.

Many common and necessary drugs are included in the long list of large price jumps. In addition to the 1,000% increase in my clobetasol, other increases include:

Digoxin, used since 1785, for heart failure and irregular heartbeat, has increased in price by 884%.

Albuterol Sulfate, used to treat asthma, has increased in price by more than 4,000%.

Pravastatin Sodium, used to control high cholesterol, has increased in price by more than 500%.

Doxycycline Hyclate, an antibiotic, has increased in price by more than 8,000%! There are many, many more examples.

What are the implications for consumers (like all of us)?

1 Individuals without drug coverage will be (and are) paying higher and higher prices for these formerly ‘cheap’ drugs. Some people will be priced out of even getting their prescriptions—not a good situation.

2 While the copays may still be small (mine, for example, is $8 for tier one meds) the insurance companies must now pay for the huge increase in generic drug costs. For those of us who have insurance and drug coverage, our copays and premiums are bound to go up and there will likely be higher insurance costs for all consumers.

3 There are no indications that the trend of rising generic drug prices will end soon.

Bottom Line

Your guess is as good as mine and I haven’t heard of any plan to resolve the situation. This is a serious situation that could have a major health impact on all of us.

axman