[Ip-health] US Medicine Price Trends

Sean Michael Flynn sflynn at wcl.american.edu
Tue Oct 28 12:07:20 PDT 2014

This report was shared recently by Paul Davis.

"The median revenue per patient of the Top 100 drugs has increased from
$1,260 in 2010 to $9,400 in 2014, representing an seven-fold increase (see
page: 7)." 
"There are now seven treatments priced in excess of $100,000 per patient per
year in 2014, versus four in 2010."
³We found that 19 drugs in the Top 100 have moved up a price bracket in the
last four years (see page: 7). E.g., nine products have gone from costing
less than a $1,000 in 2010 to being priced in the $1,000 to $5,000 bracket
in 2014.²
³The US phenomenon of drug price inflation - where prices increase after
initial launch - is in direct opposition to Japan where the government
reimbursement system reduces the price of successful products which beat
initial sales expectations at launch.²
"The biggest concern is that with government drug spend approaching 43% of
the USA market by 2017, up  from 24% in 2005, the system lacks enough
automatic discounts off the private price, and safeguards against drug price
rises from companies, to be sustainable. This is particularly an issue for
Medicare Part B and Part D programs. The expansion of Medicare (2005+) and
Medicaid (2014+) enrolment has incrementally expanded the USA drug market,
so any discounts off private drug prices will act only to moderate growth.
Thus the call 
for reform will grow stronger."

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