Report: Rapid Rise in Cost of Specialty Drugs Exceeds Median Family Income

November 23, 2015/PRNewswire-USNewswire/ -- Retail prices for over one hundred widely used specialty prescription drugs surged skyward by nearly 11 percent in 2013, surpassing the median income of an American family, according to a new AARP Public Policy Institute (PPI) report issued today.

The average annual cost of a specialty medication used on a chronic basis exceeded $53,000 in 2013. This cost was greater than the median U.S. household income of $52,250, more than twice the median income of $23,500 for people on Medicare, and almost three-and-a-half times higher than the average Social Security retirement benefit of $15,526 over the same time period.

"Specialty drugs are among the most expensive on the market, and are expected to be the fastest growing group of drugs over the next decade," said Debra Whitman, PhD, AARP's Chief Public Policy Officer.

"These exorbitant prices and price increases can be financially disastrous, especially for people on fixed incomes. Americans cannot continue to absorb the astronomical costs associated with these products indefinitely."

The AARP PPI report also found that specialty drug prices are considerably higher than other drug prices. In 2013, the average annual cost for specialty prescription drugs was 18 times higher than the cost of brand name prescription drugs and 189 times higher than the cost of generic prescription drugs.

Specialty drugs generally include drugs used to treat complex, chronic health conditions.

They often require special care in how they are administered to patients, as well as in how they are handled and stored. Many specialty drugs treat conditions that are common among older people, including rheumatoid arthritis, multiple sclerosis, and cancer.

The new report, the third in a series of reports on prescription drug prices, examined the retail prices of 115 specialty prescription drugs most widely used by older Americans.

The analysis included 47 different drug manufacturers and covered 30 different therapeutic categories. The vast majority (85%) of the 115 specialty drugs studied are used to treat chronic health conditions.

Highlights of the Rx Price Watch Report
Based on the retail prices of 115 widely used specialty prescription drugs in 2013:

• Average annual cost for one specialty medication used on a chronic basis: $53,384
• Average annual cost was 18 times higher than the cost for brand name drugs: $53,384 vs. $2,960
• Average annual cost was 189 times higher than the cost for generic drugs: $53,384 vs. $283
• Average annual price increase was more than 7 times higher than inflation: 10.6% vs. 1.5%
•  

"We know that nearly two-thirds of older Americans use three or more prescription drugs on a regular basis," saidLeigh Purvis, MPA, PPI Director of Health Services Research and co-author of the new report.

"The average price of just one specialty drug now outstrips what many families earn in a year. These high drug prices can make it extremely difficult for patients to afford the treatment they need to stay healthy."

According to the AARP PPI report, policy makers interested in reducing the impact of high drug prices should focus on solutions that balance the need for pharmaceutical innovation with the need for improved health and the financial security of consumers and taxpayer-funded programs like Medicare and Medicaid.

"Rx Price Watch Report: Trends in Retail Prices of Specialty Prescription Drugs Widely Used by Older Americans, 2006 to 2013" Methodology

AARP's Public Policy Institute, in collaboration with the PRIME Institute at the University of Minnesota, developed a group of 115 specialty prescription drug products most widely used by older Americans. Using data from the Truven Health MarketScan® Research Databases, the report analyzed retail price changes between 2006 and 2013 for these 115 specialty drugs.

Additional Resources

• Rx Price Watch Report: Trends in Retail Prices of Generic Prescription Drugs Widely Used by Older Americans, 2006-2014
• Rx Price Watch Report: Trends in Retail Prices of Brand Name Prescription Drugs Widely Used by Older Americans, 2006 to 2013
• AARP Drug Compare Tool – Learn the difference and similarities between any two Rx or over-the-counter medications.
• AARP Bulletin article, "Feeling the Pain of Costly Prescription Drugs" (Jan/Feb 2015)

Obama Administration Drug Pricing Forum Should Address Urgently Needed Prescription Savings Realized Through Importation From Safe Canadian Pharmacies

WASHINGTON, DC--(Marketwired - Nov 20, 2015) - As Americans continue to pay the highest prices in the world for basic health maintenance medications, the Campaign for Personal Prescription Importation (CPPI) is encouraged that U.S. Secretary of Health and Human Services, Sylvia Burwell, is conducting a drug pricing forum on November 20.

CPPI applauds this effort to discuss how "...the high and growing cost of drugs has created hardship for families, employers, and states" as mentioned on the forum website. However, we are disappointed that the focus remains on specialty medications.

"Millions of Americans need access to safe, affordable health maintenance medications to treat high blood pressure and cholesterol, asthma, thyroid problems, depression, and other chronic ailments. They, too, need relief from excessive prices and ridiculous annual increases in the cost of their lifesaving medications," said Bryan Tackett, executive director of CPPI.

The high cost of medications continues to top the list of public priorities for Congress and the President, according to the recent Kaiser Health Tracking Poll. Sixty-three percent of Americans believe "government action to lower prescription drug prices" should be taken. 

This can easily be done by passing one of several bipartisan bills (e.g., S. 122/H.R. 2228 or S. 2023/H.R. 3513) in Congress that would allow Americans to import their basic prescriptions from safe, affordable sources in Canada. Over the last decade, 10 million Americans have safely imported their health maintenance prescriptions from licensed, legitimate Canadian pharmacies. The results: America's seniors, retirees, and low-income individuals can maintain their health without having to choose between their medications and eating or paying their bills.

CPPI submitted a comment for the record for the November 20 forum in the hope that HHS will consider the significant savings and positive safety and health impacts that allowing individuals to import health maintenance medications from Canada would have for all Americans and U.S. taxpayers.

About the Campaign for Personal Prescription Importation

The Campaign for Personal Prescription Importation (CPPI) is a national nonprofit consumer advocacy organization dedicated to protecting and promoting access to safe, affordable imported prescription medications from Canada for 90-day personal use. 

CPPI supporters and members represent low- and fixed-income Americans who urgently need an alternative to the exorbitantly high cost of prescriptions in the U.S., which causes millions of Americans to skip doses, split pills in half, take daily medications on an irregular basis, or avoid filling prescriptions entirely, jeopardizing their health. More information about CPPI can be found online at www.personalimportation.org.

Study Shows That Without Prescription Coverage, Even Relatively Low-Cost Cancer Medicines Can Be "Catastrophic"

Newswise, November 19, 2015 — A University of Colorado Cancer Center study published in the journal Breast Cancer Research and Treatment shows that breast cancer patients whose health insurance plans included prescription drug benefits were 10 percent more likely to start important hormonal therapy than patients who did not have prescription drug coverage.

Women with household income below $40,000 were less than half as likely as women with annual household income greater than $70,000 to continue hormonal therapy. Hormonal therapy for patients with estrogen- or progesterone-positive breast cancers can reduce the risk of cancer recurrence by as much as 50 percent.

“I think what this research says is that general health insurance isn’t enough. You have to have prescription drug coverage,” says Cathy J. Bradley, PhD, associate director for Population Studies at the CU Cancer Center, professor in the Colorado School of Public Health, and the paper’s first author.

The study used surveys to explore the initiation and continuation of prescribed hormonal therapy, reaching 712 women 9 months after a breast cancer diagnosis and then again 4 years later (this maintenance therapy generally lasts 5-10 years). Of women with prescription drug coverage, 90 percent started recommended hormonal therapy and 81 percent continued through the study.

Of women without prescription drug coverage, 82 percent started hormonal therapy and 66 percent continued. Women with annual household income of less than $40,000 were only about 40 percent as likely as women from wealthier households to follow through with a doctor’s recommendation to start hormonal therapy.

The study takes place in the context of two important changes to the landscape of oncology treatment: the development of new, targeted treatments for cancer, which tend to be very expensive and also tend to be taken orally and in patients’ homes, and the Affordable Care Act, which has increased access to health insurance.

“Targeted cancer therapies tend to come in the form of pills taken at home. Many of these new therapies are expensive. This combination of more expensive medicines taken outside the hospital setting means less compliance.

Or we see people choosing to alter their prescribed regimens by skipping doses. When you start to dial back from recommended doses, at some point the drug loses its effectiveness,” Bradley says.

Bradley points to increasing costs of cancer care as a reason for insurers and healthcare consumers to rethink the definition of “catastrophic” illness.

Her findings show that women without prescription drug coverage, especially if they are from low-income households, may choose not to comply even with a relatively low-cost treatment regimen.

“When someone thinks about coverage for high cost care, they’re usually thinking about that trip to the hospital that costs $80,000 that could leave them bankrupt. But the fact is that the cost of prescription medicines—even fairly low cost medications – can also be ‘catastrophic’,” Bradley says.

She also notes that efforts under the Affordable Care Act are underway to provide prescription coverage that would guard against undue financial hardship in the case that expensive medicines become necessary.

“We have good evidence that when people feel that a drug is too expensive, they stop taking it,” Bradley says. “This study suggests that reluctance to insure prescription drugs may result in increased recurrence and poor survival among women with breast cancer, one of the largest groups of cancer survivors.”

AMA Calls for Ban on Direct-to-Consumer Advertising of Prescription Drugs and Medical Devices

November 17, 2015 - Responding to the billions of advertising dollars being spent to promote prescription products, physicians at the Interim Meeting of the American Medical Association (AMA) today adopted new policy aimed at driving solutions to make prescription drugs more affordable. Physicians cited concerns that a growing proliferation of ads is driving demand for expensive treatments despite the clinical effectiveness of less costly alternatives.

"Today's vote in support of an advertising ban reflects concerns among physicians about the negative impact of commercially-driven promotions, and the role that marketing costs play in fueling escalating drug prices," said AMA Board Chair-elect Patrice A. Harris, M.D., M.A. "Direct-to-consumer advertising also inflates demand for new and more expensive drugs, even when these drugs may not be appropriate."

The United States and New Zealand are the only two countries in the world that allow direct-to-consumer advertising of prescription drugs. Advertising dollars spent by drug makers have increased by 30 percent in the last two years to $4.5 billion, according to the market research firm Kantar Media.

New AMA policy also calls for convening a physician task force and launching an advocacy campaign to promote prescription drug affordability by demanding choice and competition in the pharmaceutical industry, and greater transparency in prescription drug prices and costs.

"Physicians strive to provide the best possible care to their patients, but increases in drug prices can impact the ability of physicians to offer their patients the best drug treatments," said Dr. Harris.

"Patient care can be compromised and delayed when prescription drugs are unaffordable and subject to coverage limitations by the patient's health plan. In a worst-case scenario, patients forego necessary treatments when drugs are too expensive."

New AMA policy responds to deepened concerns that anticompetitive behavior in a consolidated pharmaceutical marketplace has the potential to increase drug prices. The AMA will encourage actions by federal regulators to limit anticompetitive behavior by pharmaceutical companies attempting to reduce competition from generic manufacturers through manipulation of patent protections and abuse of regulatory exclusivity incentives.

The AMA will also monitor pharmaceutical company mergers and acquisitions, as well as the impact of such actions on drug prices. Patent reform is a key area for encouraging greater market-based competition and new AMA policy will support an appropriate balance between incentives for innovation on the one hand and efforts to reduce regulatory and statutory barriers to competition as part of the patent system.

Last month, the Kaiser Family Foundation released a report saying that a high cost of prescription drugs remains the public's top health care priority. In the past few years, prices on generic and brand-name prescription drugs have steadily risen and experienced a 4.7 percent spike in 2015, according to the Altarum Institute Center for Sustainable Health Spending.

The AMA's new policy recognizes that the promotion of transparency in prescription drug pricing and costs will help patients, physicians and other stakeholders understand how drug manufacturers set prices. If there is greater understanding of the factors that contribute to prescription drug pricing, including the research, development, manufacturing, marketing and advertising costs borne by pharmaceutical companies, then the marketplace can react appropriately.

About the AMA
The American Medical Association is the premier national organization dedicated to empowering the nation's physicians to continually provide safer, higher quality, and more efficient care to patients and communities. For more than 165 years the AMA has been unwavering in its commitment to using its unique position and knowledge to shape a healthier future for America. For more information, visit ama-assn.org.

Collins, McCaskill Open Senate Investigation into Rx Drug Pricing, Announce Intention to Hold Hearings Senators request documents from four pharmaceutical companies concerning business acquisitions and drug pricing policies

Senator Collins

WASHINGTON, Nov. 9, 2015 /PRNewswire-USNewswire/ -- U.S. Senators Susan Collins (R-Maine) and Claire McCaskill (D-Mo.), who together lead the Senate Special Committee on Aging, today announced a bipartisan Senate investigation into pharmaceutical drug pricing. 

The announcement follows a series of media reports detailing dramatic drug price increases—often on older, off-patent drugs—after the acquisition or merger of pharmaceutical companies.

"The sudden, aggressive price hikes for a variety of drugs used widely for decades affect patients and health care providers and the overall cost of health care. These substantial increases have the potential to inflate the cost of health care for Americans, especially our seniors, by hundreds of millions of dollars each year," said Chairman Collins. 

Senator McCaskill

"Given the potential harm to patients across our country who rely on these drugs for critical care and treatment, 

the Senate Special Committee on Aging considers these massive price increases worthy of a serious, bipartisan investigation into the causes, impacts, and potential solutions."

"Some of the recent actions we've seen in the pharmaceutical industry—with corporate acquisitions followed by dramatic increases in the prices of pre-existing drugs—have looked like little more than price gouging," said McCaskill, former Missouri State Auditor and courtroom prosecutor. 

"We need to get to the bottom of why we're seeing huge spikes in drug prices that seemingly have no relationship to research and development costs. I'm proud to help lead this bipartisan investigation so that we can find some answers the public wants and deserves."

The Senators have requested documents and information from four pharmaceutical companies: Valeant Pharmaceuticals, Turing Pharmaceuticals, Retrophin Inc, and Rodelis Therapeutics.  Each request focuses on drugs that have seen recent and significant spikes in price.

"We seek your cooperation with this investigation so that the Committee may better understand drug pricing and related regulatory and public policy concerns. In particular, the Committee wishes to learn more about Turing Pharmaceuticals' recent acquisition of the rights to sell Daraprim, a drug used to treat and prevent infections, from Impax Laboratories and Turing's subsequent decision to increase the price of Daraprim from$13.50 to $750 [per tablet]," reads the Senators' letter to Turing Pharmaceuticals CEO Martin Shkreli.

The Committee's investigation will include an examination of:

• Substantial price increases on recently acquired off-patent drugs;
• Mergers and acquisitions within the pharmaceutical industry that have sometimes led to dramatic increases in off-patent drug prices; and
• The Food and Drug Administration's role in the drug approval process for generic drugs, the agency's distribution protocols, and, if necessary, its off-label regulatory regime.

The Senate Special Committee on Aging has tentatively scheduled an initial hearing on this issue for December 9, 2015 and will hold subsequent hearings, as needed, in the following months.

Seniors account for 13 percent of the population but account for 34 percent of the all prescription medication used.  More than 40 percent of seniors take five or more prescription drugs per day.

The letter to Valeant Pharmaceuticals is available on the committee's website HERE. The letter to Turing Pharmaceuticals is available HERE. The letter to Retrophin, Inc. is available HERE. The letter to Rodelis Therapeutics is available HERE.

The Special Committee on Aging, led by Chairman Collins and Ranking Member McCaskill, promotes discussions and conducts investigations on areas of special interest to older Americans.

RxforAmericanHealth publisher calls for bi-partisan Consensus, Coalition legislation in Congress To lower prescription costs

Publisher's Note:  This news release is being sent to Congressman and Senators, as well as to media across the nation.

St. Louis, November 5, 2015--The publisher of Rx for American Health is calling for a coalition of Senators and Representatives and their staffs to reach consensus on a single comprehensive bill incorporating major points of a number of disparate legislative proposals to lower prescription medicine prices, and to be prepared to offer their bill immediately  with the reconvening of the  114^th Congress in January 2016.

Daniel Hines says that the national outrage over the ‘predatory’ pricing practices of Pharma offers an opportunity to incorporate such issues as ending ‘pay to delay’, personal importation of brand name medicines from Tier One Countries, price negotiation of medicines for Medicare and Medicaid, a recognition of a ‘stakeholder’ right for the citizens and advocates for the American public that is a major source of funding through taxes for Research and Development costs of new medicines, and a review process for patent continuation by drug companies that are found to violate the law.

“I have always hoped that the public, policy makers and media would someday recognize that a medicine that is unaffordable is equally unavailable, and, by extension, a medicine that is unavailable is equally incapable of providing any health benefit,” Hines notes.  “Now that day has come.

“This creates a climate of opportunity for long-suffering Americans who have paid steadily increasing prices for their medications. It creates a climate of opportunity to end Pharma actions that create costly—and too often unaffordable medicines—that are a major driver of health care costs.  It creates a climate of opportunity to recognize the role of the American patient, caregiver, family member as having ‘stakeholder’ rights that merit a seat at the table in the form of ordinary citizens and/or their advocates.”

Hines said it was gratifying to see the furor in Congress about prescription prices and the many forums, task forces, and various legislation that has been brought forth, but he asks, “after the many hearings are held, after the Forums are over, after the Task Forces disband, after Pharma and its front groups launch their counterattack using the vast financial support of literally dozens of members of Congress and the army of lobbyists that will be turned loose on Capitol Hill, the question remains: 

“Will this be, as Henry A. McKinnell,, the then-chairman of Pfizer scolded then-Governor Tim Pawlenty of Minnesota in a press conference following a shareholders’ meeting in St. Louis, the seeming outrage would be nothing more than a ‘Prairie Fire that comes along every four years as a product of the elections and then ‘burns itself out.

“Most importantly, it creates a climate in which the totality of the harmful  effects of Pharma pricing  strategies has been exposed.  The challenge: Will Congress exercise leadership to take the steps that will ensure success?

“It is crucial that Congress acts to ensure that the U.S. joins the rest of the industrialized world to ensure that our citizens have access to affordable, safe, and innovative medicines that will enhance the health and well-being of all Americans,” he concludes.

Call for Congressional Coalition effort to draft consensus, comprehensive legislation combining elements of proposals, for 2016 conventing of Congress

 In what may be one of the biggest news stories of 2015, and one with the potential for long-range health and financial benefits for untold numbers of Americans is that the harmful effects of Pharma pricing strategies has seemingly become an issue of primary importance to the U.S. Congress.

But, after the many hearings are held, after the Forums are over, after the Task Forces disband, after Pharma and its front groups launch their counterattack using the vast financial support of literally dozens of members of Congress and the army of lobbyists that will be turned loose on Capitol Hill, the question remains: 

Will this be, as Henry A. McKinnell,, the then-chairman of Pfizer scolded then-Governor Tim Pawlenty of Minnesota in a press conference following a shareholders’ meeting in St. Louis, the seeming outrage would be nothing more than a ‘Prairie Fire that comes along every four years as a product of the elections and then ‘burns itself out.’

That is why it is crucial that Congress acts to ensure that the U.S. joins the rest of the industrialized world to ensure that our citizens have access to affordable, safe, and innovative medicines that will enhance the health and well-being of all Americans.

As a long-time supporter and advocate for personal importation of brand name medicines, acting as a consultant on personal importation issues, I have previously expressed my support for a Congressional Caucus of Congressional supporters of personally imported brand name medications.

Now, the furor over the Pharma practice of ‘charging what the traffic will bear’ has led to a number of Senators and members of the House of Representatives of both political parties supporting legislation on behalf of a range of issues such as ‘pay to delay’; personal importation; patent rights of U.S. citizens as ‘stakeholders’ because of their dual role as patients and as major providers of the fiscal support of Research and Development costs of developing new medicines; and, measures to allow negotiation of prices for Medicare and Medicaid, a practice already in place for the Veterans’ Administration.

While all of these initiatives are encouraging, we believe it is time for a coalition of Senators and Representatives and their staffs to come together to reach consensus on a single comprehensive bill incorporating all of the points listed above, and to be prepared to offer their bill immediately  with the reconvening of the  114^th Congress in January 2015.

By so doing, Congress will assume its rightful role as the determinant of policies affecting prescription medicine safety, cost and availability with a bill that will favorably provide physical and fiscal benefits to untold numbers of Americans.  It will also end the ‘Safe Haven’ that Pharma has created in the U.S. for its predatory pricing practices. 

It was in August 2014 that I wrote how Pharma was developing ‘The Perfect Storm” to advance its agenda employing a number of techniques to ensure that America remained its ‘Safe Haven’.

An exploration of the many aspects of Pharma’s strategy led us to “…The conclusion is that whereas previous Pharma efforts had been characterized as admittedly potentially harmful, they were ‘individual’ in nature and lacked what can be determined in the present circumstance to be ‘cumulative’…”

We noted that “The current Pharma effort on a number of fronts reflects a comprehensive, coordinated strategy that by its breadth threatens the health and fiscal interests of the American patient/client…”

We cited the strong support of Pharma’s agenda by members of Congress who received millions of dollars of contributions from Pharma, noting that there existed  “…An attitude inside the Beltway by elected Senators and Representatives who are beneficiaries of huge donations from Pharma interests that is described as a ‘By Invitation Only’ (BIO) attitude.  The BIO-approach limits the opportunity for advocates of personal importation to testify before Congressional hearings on issues that affect the role of personal importation while including only Pharma interest spokespersons.”

The situation was bleak, but at the same time, I observed to colleagues that there were always certain things that we could count on from Pharma. 

The first was the arrogance of the industry which had led over many years and instances to a hubris that exposed Pharma’s primary motive, i.e. to charge the highest prices possible and whatever ‘the traffic will bear’.

I followed that with the observation that perhaps Pharma was not as smart as we gave them credit for being, noting the comment of a Pharma lawyer during the submission of comments on Section 708 of the Food and Drug Administration Safety Innovation Act (FDASIA) in which she called for the criminalization of individuals who were personally importing their authentic medicines from Tier One Countries, a policy move that was contrary to all previous FDA actions.

I have always hoped that the public, policy makers and media would someday recognize the merits of the mantra published so many times in these blogs:  A medicine that is unaffordable is equally unavailable, and, by extension, a medicine that is unavailable is equally incapable of providing any health benefit.

Now, that day has come, and it is Pharma that is attempting a pushback to overcome the wrath of the public and policy makers by claims that treatments that cost $80,000 to $100,000 are ‘worth it’ when compared to the alternative of dying.

But the highly expensive, overly priced specialty medicines were only the tip of the iceberg.  One need to only consider the spike in Generic prices in the last year.

There is finally a recognition of the problem of the predatory pricing policies at a national level as the two Democrat candidates for President have offered comprehensive legislation that for the first time combines all the elements that have contributed to Pharma abuse in proposed legislation.

The proposals include dealing with ‘pay to delay’ tactics that keep lower-cost medications from being introduced; a recognition of the ‘stakeholder’ role of U.S. citizens and taxpayers who provide much of the funding for Pharmaceutical research in the U.S. through their support of the National Institute of Health; a call for changes in the prosecution of criminal activity by Pharma members that would hold not merely the companies liable, but would subject the offending officers of the firms to criminal action; and, a strategy that would allow the ending of patent protections with the ‘ownership’ of the patents ‘returning’ to American citizens; finally, there are many bi-partisan bills in the U.S. Congress dealing with one or another aspect of Pharma practices including ‘pay to delay’, personal importation of Brand Name medicines from Tier One Countries, promotion of the broader use of generics,

The result is that whereas a year ago, Pharma was creating ‘The Perfect Storm’, it today is in an unprecedented situation in which it is not the determiner of the debate, but is instead is engaged in the middle of the storm with lightning bolts directed at them by hospitals, insurance companies, patients, Presidential candidates, and Congressional investigations.

This creates a climate of opportunity for long-suffering Americans who have paid steadily increasing prices for their medications. It creates a climate of opportunity to end Pharma actions that create costly—and too often unaffordable medicines—that are a major driver of health care costs.  It creates a climate of opportunity to recognize the role of the American patient, caregiver, family member as having ‘stakeholder’ rights that merit a seat at the table in the form of ordinary citizens and/or their advocates. 

Most importantly, it creates a climate in which the totality of the harmful  effects of Pharma pricing  strategies has been exposed.  

The challenge: Will Congress exercise leadership to take the steps that will ensure success, or, will we witness another Prairie Fire burning out?