Drug Prices Increase 5% in 2021

A new analysis by market research firm 46brooklyn found that the median wholesale price for 645 brand-name medicines in the U.S. increased 4.8% on January 1, 2021, as pharmaceutical companies announced new drug prices for the beginning of the year. However, this figure could change as more early-year price increases are announced.

Among the companies that reported increases, AbbVie raised the wholesale prices of its drugs by an average of 5%, including 7.4% increases for its rheumatoid arthritis treatment Humira (adalimumab) and cancer drug Imbruvica (ibrutinib). Pfizer raised wholesale prices by an average of 3.7%, and GlaxoSmithKline by 3%.

In addition, the analysis found that 40% of prescription drugs in the Medicare program will be affected by the price increases, with the average cost per claim rising to $809 in 2021, up from $777 last year.

Wholesale prices do not include discounts or rebates pharmaceutical companies often pay to pharmacy benefit managers to place their products on formularies. Drug companies argue the price hikes will be offset by higher rebates paid to insurers and middlemen.

Until a few years ago, double-digit percentage increases on pharmaceuticals were common practice, but under intensifying political scrutiny, drug companies have mostly kept the hikes under 10%.

Source: STAT+, January 4, 2021.