Free Access To Email Exclusive ContentGet notified and be the first to know when new & hot content drops
HomeHealth & Medical NewsMajor Drugmakers, Including Pfizer and Sanofi, Set to Increase Prices on Over...

Major Drugmakers, Including Pfizer and Sanofi, Set to Increase Prices on Over 500 Drugs in January

Download the Pottageofhealth App!

Continue reading in the app and explore more content from our exceptional editors.

Available on Google Play Available on App Store

In a significant development with potential repercussions for healthcare costs in the United States, some of the world’s major Drugmakers, including Pfizer, Sanofi, and Takeda Pharmaceutical, are gearing up to implement price hikes on over 500 drugs in early January. This information comes to light through an analysis of data conducted by healthcare research firm 3 Axis Advisors.

The imminent price increases, affecting more than 140 brands of drugs, are timed in anticipation of the Biden Administration’s planned release of substantially discounted prices for 10 high-cost drugs in September. These moves are taking place against a backdrop of ongoing challenges for the pharmaceutical industry, ranging from higher inflation to escalating manufacturing costs, and concerns about potential disruptions to supply chains due to the protracted conflict in the Middle East, which has led shippers to reconsider or reroute traffic along the Red Sea, a critical East-West trade route.

President Joe Biden’s Inflation Reduction Act (IRA) grants the government’s Medicare health program the authority to directly negotiate prices for certain drugs starting in 2026. This legislative change is part of broader efforts to address the rising costs of healthcare.

Notably, beyond the price hikes, three pharmaceutical companies, including GlaxoSmithKline, have signaled their intent to lower prices on at least 15 drugs in January. This follows a trend established earlier in the year when several companies announced preemptive price decreases for insulins. This strategic move was aimed at avoiding penalties mandated under the American Rescue Plan Act, which requires drug companies to rebate the Medicaid program if their drug prices outpace inflation. Starting January 2024, these rebates could even exceed the actual net cost of the drug, adding a layer of complexity to pharmaceutical pricing strategies.

See also  UNIMEDTH Celebrates Pioneer Medical Students and Launches Student Loan Program

Expressing concern about the potential impact of these policies, Antonio Ciaccia, President of 3 Axis, remarked, “Every major former blockbuster insulin is going to get thrown under the tires of this policy,” highlighting the industry’s need to navigate evolving regulations and pricing dynamics.

In contrast to the broader trend, some pharmaceutical companies are planning to decrease prices. Notably, Eli Lilly is set to lower the prices of its Humalog and Humulin insulins by 75.8% and 70%, respectively, on December 30. However, these changes were not factored into 3 Axis’ data. Additionally, the price of Eli Lilly’s popular diabetes drug Mounjaro is expected to increase by 4.5% on January 1.

It is crucial to note that the reported changes primarily pertain to list prices, which do not account for rebates to pharmacy benefit managers and other discounts. As of now, the drugmakers mentioned in the report have not provided immediate responses to requests for comments.

Despite the economic challenges posed by higher inflation, pharmaceutical companies, in line with industry practice, have largely limited price increases to 10% or below. This cautious approach has been adopted by many major players in response to past criticism of excessive price hikes, particularly in the middle of the last decade. Even with concerns about the U.S. drug price negotiation plan under the IRA and persistent inflation, median price increases have hovered around 5% since 2019, as reported by 46brooklyn, a drug pricing non-profit associated with 3 Axis.

For the second consecutive year, Pfizer stands out by announcing the highest number of January price increases, accounting for over a quarter of all drugs with hikes planned. The New York-based pharmaceutical giant is set to increase prices on 124 drugs and add an additional increase on 22 drugs through its Hospira arm.

See also  Contaminated Cinnamon Scandal: FDA Probes High Lead Levels Linked to Recalled Applesauce Pouches

Following Pfizer, Takeda-owned Baxalta and Belgian drugmaker UCB Pharma have the second and third-highest number of planned price increases, with 53 and 40 hikes respectively.

Sanofi, despite pledging to cut 2024 prices on most prescribed insulin products earlier in the year, will raise prices on its typhoid fever, rabies, and yellow fever vaccines by 9% in January.

Industry analysts expect additional drug price announcements throughout January, historically the peak month for pharmaceutical companies to implement price adjustments. In 2023, drugmakers raised prices on 1,425 drugs, a slight decrease from the 1,460 drugs that saw price increases in 2022, according to data from 46brooklyn.

While the pharmaceutical industry has restrained price increases for established drugs, newly launched drugs have seen a surge in prices. In 2022, the price of newly launched drugs exceeded $220,000, up from around $180,000 in the first six months of 2021, indicating a more than 20% increase. This aligns with a study published in the Journal of the American Medical Association (JAMA) that reported a 20% annual growth in U.S. drug launch prices between 2008 and 2021.

As the pharmaceutical landscape undergoes these shifts, the industry will need to balance pricing strategies with regulatory changes, economic conditions, and evolving consumer expectations. The coming months are likely to see continued scrutiny and discussion surrounding drug prices, as stakeholders seek a balance between innovation, access, and affordability in the healthcare sector.

 

Free Access To Email Exclusive ContentGet notified and be the first to know when new & hot content drops

Must Read

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Connect with us

23,950FansLike
2,083FollowersFollow

Recommended