MONDAY, April 10, 2006 (HealthDay News) -- There's a bit of good news in the latest AARP report that prescription drug prices continue to outpace the rate of inflation.
The rate of increase for a sample of 193 brand-name drugs was 6 percent in 2005, higher than the 3.4 percent inflation rate that year, but "that was a little more reasonable than in previous years," said John Rother, policy director at AARP.
And the average price of the 75 generic drugs monitored by AARP actually dropped, if only by 0.8 percent, in 2005, the report said.
"One bottom line for consumers is that the value of generic drugs is going up, so they can save even more money by switching to generics," Rother said.
That decrease in generics was due entirely to a drop in the price of 100 milligram tablets of the generic version of the antibiotic ciprofloxacin, down more than 38 percent in 2005. There were price increases for six generic drugs, while the prices of the other 68 covered in the report did not change, according to the report.
By contrast, the price increases for the 187 brand-name drugs used by older people for chronic conditions, such as high blood pressure, arthritis pain and cardiovascular disease, meant that the average annual cost per prescription was $47.43 higher in 2005, slightly better than the $51.82 increase in 2004, the report said.
Over the six years that AARP has been issuing its Rx Watchdog review, the average annual cost of therapy with brand-name products used to treat chronic conditions increased $297. But, typical older Americans regularly take four drugs, so their annual cost of therapy rose almost $1,200 from 1999 through 2005, the report said.
Looking at the 24 most widely used brand-name drugs, AARP found the highest price increase, 11.1 percent, was for Toprol XL 50-milligram tablets, a beta blocker marketed by AstraZeneca. The lowest increase among these best sellers, 2.9 percent, was for Plavix 75-milligram tablets, a clot-preventing drug marketed by Bristol-Meyers Squibb.
A prediction of higher prices to come was made by Sharon Treat, executive director of the National Legislative Association on Prescription Drug Prices. She said her pessimism was based on the terms of the new Medicare prescription drug program, which took effect at the start of this year.
The program, Medicare Plan D, requires participants to enroll with one of many private insurance companies, the terms of whose offers differ widely. "And the incentives are completely wrong," Treat said. "It makes no sense to have multiple programs, and there is no provision for negotiating prices with the companies. Anyone who looked at the law as it was being passed knew that it was wrong, and now what we predicted is happening."
Rother's appraisal was more cautious. The new Medicare program went into effect after the period covered by the latest AARP report, he noted, adding, "I don't want to speculate on what might happen. I don't think we can say yet."
Pharmaceutical companies "made a lot of pledges" about holding prices down, Rother said. If that does not happen, "it would invite more legislation by Congress," he said.
But the trend over the last six years has been for drug price increases to be higher than the general rate of inflation, Rother said, noting the average price increase of 40 percent, compared to inflation at 17 percent.
AARP releases its Rx Watchdog report periodically, tracking changes in drug pricing for its 35 million members aged 50 and older. The group bases its figures on changes in manufacturers' list prices for wholesalers.
More information
To view the full report, visit AARP.
