Despite President Donald Trump’s attempts to shame drugmakers into freezing price hikes, more than three dozen pharmaceutical companies defied the president and did exactly the opposite on Jan. 1.
The industry saw medication costs rise across the board — not even generic drugs were immune.
The health software company Rx Savings Solutions found that dozens of drugs produced by major brands such as Allergan and Hikma Pharmaceuticals saw average price increases of about 6.3 percent as the new year began.
Allergan confirmed its price increases in a statement to [The Wall Street Journal], reporting that the company had raised the price on 27 products by about 9.5 percent, while another 24 drugs saw price increases of about 4.9 percent.
In the statement, Allergan pointed to a pledge made in 2016 stating that the company would keep price increases under 10 percent and stick to one hike in costs per year while adding that Allergan was “committed to responsible pricing principles” that were outlined in that pledge.
Likewise, a spokesman for Hikma Pharmaceuticals said the increases, including 10 percent for morphine and 30 percent for the blood-pressure medication enalaprilat, “enable us to continue operating a sustainable business that serves hospitals, doctors and patient needs for high-quality medications.”
But Michael Rea, CEO of Rx Savings Solutions, told the Journal that lack of oversight in the U.S. is what allows pricing to climb upward.
“The reason it can keep happening is there is no market check, no person or entity to bring reason to determining drug prices," Rea said.
Reuters noted that this lack of oversight is precisely why the U.S. is consistently the most lucrative market for pharmaceutical companies.
Having campaigned heavily on putting a check on drug pricing, Trump has made some effort to rein in drug companies — but not to a degree that has yielded much, if any, fruit.
According to Reuters, the “Department of Health and Human Services has proposed a slew of policies aimed at lowering prices and passing more of the discounts negotiated by health insurers on to patients”, but these measure will provide no short term relief for consumers and “fall short of giving government health agencies direct authority to negotiate or regulate drug prices.”
Trump’s pleas worked for just a short time, as companies like Pfizer, Bayer, Novartis, Allergan, AstraZeneca and Amgen promised last summer to hold off on raising prices until 2019.
But the shame factor was not enough to bring meaningful change.
"Requests and public shaming haven't worked" to lower drug prices, said Michael Rea, chief executive of RX Savings Solutions, which helps health plans and employers seek lower cost prescription medicines. "We expect the number of 2019 increases to be even greater than in past years."
Apart from the president, others in Washington are also working to bring drug pricing under control:
The Hill reported that Senator Bernie Sanders (I-VT) and Rep. Ro Khanna (D-CA) introduced a bill in November seeking to “strip monopolies from drug companies engaging in excessive price increases and would allow companies to produce cheaper versions of generic drugs.”
“No other country allows pharmaceutical companies to charge any price they want for any reason they want,” Sanders, who is considered a potential 2020 presidential contender, said in November.
“The greed of the prescription drug industry is literally killing Americans and it has got to stop,” he added.