The retail price for a set of 768 prescription drugs rose by 6.4% in 2015, while the general inflation rate increased by just 0.1%, according to the AARP Public Policy Institute and the PRIME Institute at the University of Minnesota in Minneapolis.
One year, of course, does not make a trend, but how about 10 years? The average increase in the price of the “market basket” of 768 drugs widely used by older Americans has exceeded the rate of inflation every year since the AARP started tracking costs in 2004. This is “attributable entirely to drug price growth among brand name and specialty drugs, which more than offset often substantial price decreases among generic drugs,” Leigh Purvis of AARP and Stephen Schondelmeyer, PharmD, PhD, of the Prime Institute, said in an Rx Price Watch report.
In 2015, the price changes for the three segments of the market basket worked out like this: The 268 brand-name drugs jumped by 15.5%, the 101 specialty drugs increased by 9.6%, and the 399 generic drugs fell by 19.4%, the investigators reported. The overall increase of 6.4% for the entire basket was the smallest since 2010, but the 0.1% inflation rate was the lowest since it hit –0.3% in recession-era 2009.
In terms of actual cost, however, the specialty drugs were far ahead of the other two segments. The average cost of a year of treatment with a specialty drug was more than $52,000 in 2015, which was nine times higher than the brand-name drugs ($5,800) and 100 times higher than the generics ($523), they said.
The Rx Price Watch reports are based on retail-level prescription prices from the Truven Health MarketScan Research Databases. The general inflation rate is based on the Consumer Price Index–All Urban Consumers for All Items, which is measured by the Bureau of Labor Statistics.