While the development of newer, more effective medications does increase drug prices overall, a study conducted at the University of Pittsburg and the UPMC Center for High-Value Health Care suggests there’s more behind rising drug prices than innovation: Drug manufacturers are hiking up the prices of older medicines as well.
The researchers examined list prices of tens of thousands of drugs, using codes from a national database and pharmacy claims between 2005 and 2016. Brand-name drugs were considered “new” for the first three years after they became available, and generics were considered “new” during the first three years after the applicable patent expired.
They found that the average price of brand-name oral medications increased by about 9 percent per year — nearly five times higher than the rate of inflation — and that the average price of brand-name injectables like insulin increased by about 15 percent per year. In some cases, the drugs had been on the market for years.
Sourced from: University of Pittsburgh