Brand-Name Drug Prices Spiral Out of Control

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April 29, 2006 | 9,345 views

Prices for brand-name drugs rose 6 percent in 2005, far outstripping the pace of inflation. Even so, this was the smallest increase since 2001. Prices for generic drugs, on the other hand, fell in both 2004 and 2005, dropping nearly 1 percent last year.

Wholesale Costs

The numbers come from a review of prices for almost 300 widely used brand-name and generic drugs. Industry representatives have criticized the numbers as only being wholesale costs, which do not reflect the discounts often granted by drugmakers to pharmacies or insurers.

Passed on to Patients

The AARP (American Association of Retired Persons), which produced the report, counters that wholesale prices are passed through to patients, and are often the starting point for negotiations on final costs.

The AARP is campaigning for Congress to give Medicare officials the authority to negotiate for lower prices, and to allow consumers to import lower-cost drugs from other countries.

Sure is nice to have the convenience of taking a pill to "solve" your health challenges. However, unlike fast food where it will be relatively inexpensive to make this choice, choosing pills to improve your health is not going to be so inexpensive.

The drug companies are quite clever. They realize that people want a simple one-pill solution for their problem, but they also understand that very few would be willing to pay large amounts of money for this solution, especially when they are used to fast food prices for convenience.

The work around was to have a third party insurance system hide the bill. So most of you never see the true cost of you medications. However, many people have bills that are literally thousands of dollars a month for the drugs they are taking, as many of the new "miracle" drugs I see coming out cost $1,000 or more per month.

Folks, someone is paying this bill. Don't fool yourself. Insurance companies are not charities. This drug bill is one of the primary reasons the United States is paying $2 trillion a year for health care.

So when you rely on drug-based solutions you are just contributing to this financial mess in addition to -- and more importantly -- hurting your own health.

It is time to take a stand and follow a path that will get you on a drug-free life. Why pay your money to drug companies at all? Instead, you could just make some simple lifestyle changes that will keep you healthy and disease-free.

Although some entities, namely the Pharmaceutical Research and Manufacturers of America, may dispute the use of wholesale drug costs, the fact is that only five of the 193 brand-name drugs the AARP tracked didn't jump in price last year. And 84 percent of the drugs increased in price well beyond the rate of inflation.

The drugs with the steepest wholesale price increases:

  • Combivent: 22.1 percent

  • Ambien: 19.5 percent

  • Flovent: 19.3 percent

  • Atrovent: 18.6 percent

  • Lantus: 14.9 percent

The report doesn't take into account new brand-name drugs that are merely minor variations of older drugs, which are now generic, making their higher price completely unnecessary and basically a scam.

[+]Sources and References [-]Sources and References