The Food and Drug Administration (FDA) has approved a record number of generic drugs to go to market during President Donald Trump’s tenure, but drug pricing experts say it isn’t doing much to lower drug prices for consumers overall.
In an interview with Fox Business, Secretary of Health and Human Services Alex Azar said flooding the market with generics will force drugmakers to lower prices across the board.
“[Trump] said, approve these drugs because competition lowers prices,” Azar said. “We’ve had historic levels of [generic] drug approvals, almost 3,000 [in three years].”
But drugmakers are hiking drug prices higher than ever before, and even generic drugs are becoming increasingly expensive.
According to a report from CBS News, drugmakers raised the prices of 3,400 drugs by 17 percent during the first half of 2019, and the average price hike was 10.5 percent, which is five times the rate of inflation.
The Institute for Clinical and Economic Review (ICER) found that price hikes on just seven drugs — which averaged around 20 percent — cost Americans more than $5 billion a year.
According to 2019 research from the Generics and Biosimilars Initiative, generic drug prices increased by an average of more than 38 percent in 2014. However, generic drug prices tend not to increase as quickly as brand-name drugs.
The Office of Statewide Health Planning and Development (OSHPD) found that the wholesale acquisition cost (WAC) of generic drugs increased on average 31-154 percent over the last three years, while the WAC of brand-name drugs increased on average 23-37 percent.
This week, health insurer Humana sued 37 generic drug manufacturers, accusing them of “engaging in a far-reaching conspiracy” to “blatantly fix the price” of their drugs.
Robert Laszewski, president of Health Policy and Strategy Associates, told InsideSources that generics help lower prices somewhat, but aren’t a cure-all solution for lowering sky-high drug prices.