A new report from U.S. pharmacy benefits giant Express Scripts (ESRX) finds that the average prices of brand name drugs have nearly doubled in the past five years. That’s despite the fact that overall spending on drugs in 2015 rose at half the rate of the previous year.
Express Scripts pointed to high-cost specialty and biologic medications such as AbbVie’s (ABBV) anti-inflammatory treatment Humira, the world’s best-selling drug, as the primary culprit for the branded price spikes.
Other specialty therapies such as Gilead’s (GILD) superstar hepatitis C cures Sovaldi and Harvoni and expensive new cancer medications also lent to the trend.
While pharmaceutical companies argue that the high prices are justified considering the perilous and expensive journey from early product development to market, that assertion hasn’t typically inspired public sympathy or shielded the industry from the ire of politicians.
Hillary Clinton, Donald Trump, and Marco Rubio have all criticized drug price spikes, with Clinton singling out ostensible bête noires such as the embattled Valeant Pharmaceuticals (VRX) and former Turing Pharma CEO Martin Shkreli. Findings like the ones in the new Express Scripts report is unlikely to help buck that trend.
For its part, the benefits manager has been an ardent thorn in the side of biopharmaceutical companies’ pricing practices. Express Scripts shook up the industry with its unexpected 2014 decision to exclusively back AbbVie’s Sovaldi/Harvoni competitor VieKira Pak in exchange for a discount on the pricey drug.
Outgoing CEO George Paz has asserted that payer pushback on high drug prices will only persist as therapies become more personalized, specialized, and expensive.
