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Updated December 29th, 2023 at 21:39 IST

Pharma giants plan to raise US prices on at least 500 drugs in January

More than 140 brands of drugs will have their prices raised next month.

Business Desk
pharmaceuticals
Drug price hike in US soon | Image:Shutterstock
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Pharma giants including Pfizer , Sanofi and Takeda Pharmaceutical are mulling to raise prices in the United States on more than 500 drugs in early January, as per data analysed by healthcare research firm 3 Axis Advisors. Apart from different doses and formulations, more than 140 brands of drugs will have their prices raised next month, the data showed. The anticipated price hikes come as the pharmaceutical industry gears up for the Biden Administration to publish significantly discounted prices for 10 high-cost drugs in September, and continues to contend with higher inflation and manufacturing costs.

Under President Joe Biden's Inflation Reduction Act (IRA), the government's Medicare health program can negotiate prices directly for some drugs starting in 2026. Worries are also growing about fresh disruption to supply chains from a prolonged Middle East conflict, with shippers forced to halt or reroute traffic from the Red Sea, the world's main East-West trade route.

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Three companies including GlaxoSmithKline, which last week said it would cut prices on some asthma, herpes and anti-epileptic drugs for 2024, are also expected to lower prices on at least 15 drugs in January, according to the data. The cuts come after several companies have already announced price decreases for insulins earlier this year, in an effort to avoid penalties that could have been imposed under 2021's American Rescue Plan Act if they had kept prices high.

Under the law, drug companies are required to rebate the Medicaid program if price increases on medicines outpace inflation - and beginning in January 2024 those rebates could even be larger than the actual net cost of the drug. "Every major former blockbuster insulin is going to get thrown under the tires of this policy," 3 Axis president Antonio Ciaccia said.

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Truist analyst Robyn Karnauskas said in a note that Eli Lilly planned to lower the prices of its Humalog and Humulin insulins by 75.8 per cent and 70 per cent respectively on December 30, and to raise the price of its popular diabetes drug Mounjaro by 4.5 per cent on January 1. These changes were not included in 3 Axis' data. The changes are on list prices, which do not include rebates to pharmacy benefit managers and other discounts. The drugmakers did not immediately respond to requests for comment.

(With Reuters inputs) 

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Published December 29th, 2023 at 21:39 IST

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