The bill of new drugs

The Contribution Of New Product Entry Versus Existing Product Inflation In The Rising Costs Of Drugs

In the US there is a huge concern over drug prices. The question is what's driving expenditure growth, new product entry or inflation? In new product entry we have two categories, generic drugs and innovations (in specialty drugs). The answer appears in the latest issue of Health Affairs.

In this retrospective study of pharmaceutical pricing data for 2005–16, we found that increases in the costs of specialty and generic drugs were driven by the entry of new drug products, but rising costs of brand-name drugs were largely due to inflation in existing medication prices.

The costs of oral and injectable brand-name drugs increased annually by 9.2 percent and 15.1 percent, respectively, largely driven by existing drugs. For oral and injectable specialty drugs, costs increased 20.6 percent and 12.5 percent, respectively, with 71.1 percent and 52.4 percent of these increases attributable to new drugs. Costs of oral and injectable generics increased by 4.4 percent and 7.3 percent, respectively, driven by new drug entry. The rising costs of generic and specialty drugs were mostly driven by new
product entry.

We would need similar data for our country. Nobody knows anything, prices are confidential.

PS. On drug pricing scams.

Count Basie and the beginning of swing