US new drug price is higher than $200,000 median by 2022.
After setting record-setting U.S. prices in the second half of 2022, pharmaceutical companies continued to introduce new medicines at a high cost during the second half of the year, an analysis of the starbulletin has revealed, highlighting their strength in spite of legislation designed to cut prices for older prescription medicines.
The median annual cost of the 17 new drugs that have received U.S. Food and Drug Administration (FDA) approval since July 2022 is $193,900. This is less than $257,000 in the early part of 2022 Starbulletin discovered. In the full year 2022 the median was $222,003.
In 2021 the median annual cost was $180,000 for 30 first drugs marketed up to mid-July, as per an article published in JAMA.
The most recent figures suggest an increase of double-digit percentages year-over-year.
“I don’t see anything changing that trend,” Dr. Aaron Kesselheim, professor of medicine at Harvard Medical School and Brigham and Women’s Hospital spoke to the Starbulletin. Kesselheim, who was co-author of the JAMA study, believes that Congress is likely to eventually need to deal with the overly expensive launch prices.
The analysis of the starbulletin comprises three high-cost one-time gene therapies which the FDA accepted in the second quarter of 2022. Hemogenix CSL Limited’s (CSL.AX) $3.5 million gene therapy for hemophilia B was approved by the FDA in November and is the most expensive medication ever.
The study excludes the use of drugs to treat cosmetic issues or infrequently and imaging agents, which haven’t yet been released commercially or marketed to be used as part of an bundled reimbursement plan in a hospital environment.
The findings are based on an analysis conducted by U.S. Democratic Representative Katie Porter discovered that the cost per year of the latest cancer drug launched across the United States averaged $283,000 in 2021. This is a 53% increase over 2017.
The pharmaceutical industry believes that new medications that treat rare illnesses, have value in terms of lesser emergency room visits as well as hospitalizations.
Drugmakers also emphasize that they are not able to determine the price U.S. patients end up paying for the drugs. They often offer savings cards and other programs that help reduce expenses out of pocket.
Health insurance providers and other payers frequently require rebates and discounts for prescription drugs when competing treatments are available. With expiring patents, lower-cost generics are also able to reduce cost increases for prescription drugs that in the twelve months that ended November 20, 2022 was 1.9 percent as per the Bureau of Labor Statistics.
Congress this year adopted the historic Inflation Reduction Act that includes an annual cap on drug price increases. It also allows the Medicare health plan for seniors to negotiate prices for up to 20 medications it pays the most.
The law, however, does not restrict what drug companies are allowed to charge for new drugs.