The latest Rx Price Watch report finds that the cumulative change in retail prices for a combined set of prescription drugs widely used by Medicare beneficiaries was almost double the rate of inflation between 2005 and 2009. For a consumer who takes a prescription drug on a chronic basis, this translates into an increase in the annual cost of therapy of more than $1,000 over the same time period. These findings are attributable entirely to drug price growth among brand and specialty drugs, which more than offset substantial price decreases among generic drugs.
These AARP Public Policy Institute reports are a new iteration of our Rx Watchdog report series that has been tracking manufacturer price changes for widely used prescription drugs since 2004. The new name for this report series (i.e., Rx Price Watch) marks our switch to retail prices - or the amount that is actually charged to consumers (and/or insurers) - as our primary data source. Thse reports are based on drugs widely used by Medicare beneficiaries; previous reports were based on utilization patterns for older Americans in general.
Specifically, the reports compare retail price changes with the rate of inflation. They also present differences in average price changes by manufacturer and by major theraputic category. The sample of drugs studied was identified using 2006 data from a Medicare Part D plan provider, and changes in prices were measured using changes in the retail prices charged to consumers ages 50 and older enrolled in employer-sponsored health plans, as reported by the Thomson Reuters Marketscan® Research Databases.
For more information, please contact the AARP Public Policy Institute at (202) 434-3890