New dashboard launched to examine Medicaid markup galaxies

A few months ago, we released our Medicaid Markup Universe that collects all generic drugs dispensed within different state Medicaid programs and displays each as a bubble. The larger the bubble, the greater the cost the state is paying for that drug relative to its acquisition cost (i.e. “markup”).

While that dashboard provides a good qualitative feel for individual drug pricing distortions, it doesn’t help quantify the distortions. To better identify those distortions in each Medicaid program, we designed a new visualization that drills down to three different groups (or celestially-speaking, “galaxies”) within the universe. We call them the High-Cost, In-Range, and Low-Cost galaxies.

Our newest dashboard, the Medicaid Markup Galaxies, shows which drugs state Medicaid programs may be underpaying for, and perhaps more importantly, which drugs they may be overpaying for.

Using this new dashboard, our latest report explores these galaxies to examine what different state Medicaid programs are seeing from "galaxy-to-galaxy."

In other news, with the month of January in the books, we can finally put a bow on the January drugmaker price increases.

For those of you keeping score at home, we have updated our Brand Drug Price Change Box Score that tracks weekly price increases on brand-name drugs.

If list prices are your thing, then there is a lot to be encouraged by. HHS Secretary Alex Azar and his team seem to have put enough pressure on drugmakers to drive price increases to their lowest totals in five years.

Of course, these are just sticker prices, and net prices (that feature drugmaker pricing concessions to PBMs) are not reflected in the data. That's really important, because as a result, list prices provide a distorted picture of the reality of drug spending.

That said, every benchmark is important and relevant, so it's nonetheless valuable to keep track of, especially with the intense public focus on list prices.

One interesting note in this week's CMS drug pricing update is that Zorvolex (an Iroko Pharmaceutical product) has already registered its second price increase this year. The week of January 9th, Iroko announced a 9.4% increase on both strengths of the drug. Fast forward just one month and the price on both strengths was increased again, but this time by 69.7%. Within the CMS database, Zorvolex is the only drug to experience more than one increase this year, and furthermore, the 69.7% increase represents the largest single brand drug price hike in over a year.

What happened here? While we can't be certain, there is one interesting piece to this puzzle. According to CMS' database, the effective date of this latest price increase was February 1, 2019. On January 31, 2019, Egalet Corporation closed on the purchase of Zorvolex and three other marketed products from Iroko. Hmmm...

Lastly, a few shout-outs: