In case you missed it, a new IMS Institute health care brief found that net price increases in 2014 for branded medicines was the “lowest in the past five years” after accounting for discounts, rebates, coupons and other concessions to payers.
The brief complements research the IMS Institute previously published that found invoice brand drug prices increased 13.5 percent last year. However, this price growth did not reflect the substantial – and typical – discounts negotiated by insurers and pharmacy benefit managers.
According to the new brief, after accounting for all of the concessions, prices increased by just 5.5 percent last year, which was in line with overall health care spending growth. According to IMS, “payers appear to be limiting overall branded product price growth through the negotiation of discounts and rebates.”
Furthermore, the authors wrote that "price levels for pharmaceuticals in the U.S. market are often reported to the public based on list prices, and therefore do not reflect the series of adjustments that occur throughout the healthcare system and ultimately determine who pays what for medicines. By bringing context and perspective to the complex interplay of factors that determine the level of price changes for branded medicines we hope to better inform discussions of the issues.”
The competitive biopharmaceutical marketplace that exists in the U.S. is why spending on medicines has been a consistent share of overall health care spending since 1960 and how biopharmaceutical companies are able to continue the search for the next generation of life-changing medicines.
Get the facts about the cost and value of medicines and barriers to patient access here.
Learn more at www.phrma.org/cost.
Topics: Drug Cost