Brand drug list prices remain largely in check so far in 2019

Last month, we reported that it appeared as if the quest for lower drug prices was progressing in a positive direction. As far as sticker prices go, January 2019 appeared to have the lowest number of brand drug price increases and those increases experienced the lowest aggregate rate of growth in five years as well. Less increases and smaller increases.

Now, with February’s data in the books, things still look as though they are trending in the right direction. The only surprise this month was the relatively late price updates from Eli Lilly, which accounted for 13 increases last month, averaging 4% per increase. While this is a relatively modest year for Lilly price increases, it accounted for roughly a third of all increases last month.

Brand Drug Price Change Box Score Feb 2019.png

Of course, as we mentioned last month, the big surprise was the 69.7% increases on both strengths of Zorvolex. In case you missed it, check out Axios’ Bob Herman’s overview of the story behind the massive increase.

While we stress that these are just sticker prices, these trends continue to point to the prophesized erosion of the “gross-to-net-bubble.” Just in time for Lilly to release an authorized generic version of Humalog, and just in time for UnitedHealth/OptumRx to push “rebates” through to plan sponsors.

All of this drug supply chain disruption should yield less systemwide incentive for higher prices, and it is quite possible that we are seeing early signs of what’s to come.

To view all the recent changes in brand name prices, be sure to check out our freshly updated Brand-Drug Price Change Box-Score.

In other news, it appears that our poking around on generic Omeprazole tablets last December has inspired some follow-up digging from Eric Coldwell and his team at Robert W. Baird & Co.

To recap, back in December, we released our 46brooklyn Drugmaker Market Share Dashboard, which helps paint of picture of generic manufacturer market share. We’ve embedded it for you below, but highly recommend accessing it directly on our site (or even on Tableau Public, where the scaling of the dashboard will be even larger) to get the best experience using the tool.

As we played around with this dashboard, we started digging into some anomalies we had been noticing on generic Prilosec OTC tablets (Omeprazole 20 mg Tablets), especially in Ohio Medicaid managed care.

As an over-the-counter medication, we were surprised when we saw massive charges to the state on the drug, especially when it could be regularly purchased without insurance for $15 off the shelf. Yet we noticed that Ohio Medicaid was being charged an average markup of $153 for each prescription dispensed in their PBM-controlled managed care pharmacy program.

What happened was that the dashboard showed that Major Pharmaceuticals had been rapidly gaining market share in Ohio’s Medicaid managed care program, despite being significantly overpriced when compared to other manufacturers of the drug. You can read about our inquiry here.

Well, like much of our work at 46brooklyn, our inquiry into Omeprazole tablets was enlightening but incomplete. And rather than accept a story without an ending, Coldwell and the good folks at Baird took the ball and ran with it, and boy, did they add some interesting detail into the mix.

To learn more about the interesting intermingled relationships and unhealthy incentives that have resulted in millions of dollars of overcharges in state Medicaid programs on just this one drug, check out the Columbus Dispatch’s deep-dive into the issue, complete with commentary from Coldwell and your friends at 46brooklyn.

“And about ‘these ridiculously priced tablets,’ Coldwell questioned: ‘If CVS doesn’t have any control over the items that they claim not to control, then why are we (taxpayers) paying them so handsomely?’”

Finally, here’s a little news round-up from the last couple weeks.

In advance of the U.S. Senate hearing with drugmakers, Ned Pagliarulo at BioPharma Dive cited our Brand-Drug Price Change Box-Score to highlight recent drug price increases.

With Eli Lilly announcing plans to launch a generic version of Humalog, 46brooklyn’s Antonio Ciaccia discussed the complexity of the drug supply chain and its impact on list prices with Shari Rudavsky at the Indianapolis Star.

Also, with the shocking news of FDA Commissioner Scott Gottlieb planning to step down, Ciaccia engaged in a quasi-therapy session with Joyce Frieden at MedPage Today.

Lastly, be sure you check out the Dispatch’s look at Ohio’s spending on those pesky Omeprazole Tablets.