fb tracking

Just Three of World’s Top 28 Pharmaceutical Corporations Agree to Limit Price Hikes to Single Digits

April 11, 2017

Just Three of World’s Top 28 Pharmaceutical Corporations Agree to Match Pledge, Limit Price Hikes to Single Digits

Public Citizen Survey Highlights How Profit Motive Trumps Patient Care

WASHINGTON, D.C. – Just three of the world’s top 28 pharmaceutical corporations have agreed to match Allergan’s pledge to limit price increases to single digits each year, according to a Public Citizen survey (PDF).

Allergan announced in September that it had decided to adhere to a single-digit limit. AbbVie, Novo Nordisk and Valeant agreed to the limit as well.

“Asking for a limit of single-digit increases is a really modest request that still enables corporations to reap substantial and excessive profits,” said Peter Maybarduk, director of Public Citizen’s Access to Medicines Program. “By and large, Big Pharma won’t commit even to that. Our survey results highlight how the pharmaceutical industry will not self-regulate and our elected officials need to step in with reforms that protect consumers.”

For the survey, Public Citizen sent letters to the world’s top 28 pharmaceutical corporations, (other than Allergan), calculated by revenue, asking them to adhere to the same pledge taken in September by Allergan’s CEO to restrict annual increases of its products to less than 10 percent.

Thirteen companies replied. Two of those that have agreed to limit increases didn’t respond but issued public statements in December (Novo Nordisk) and January (AbbVie). Valeant, which sparked controversy in 2015 over its high prices, told Public Citizen by phone that it had now decided to limit annual increases to single digits.

Teva Pharmaceuticals said that its current practice is to limit increases to single digits, but it stopped short of saying it would continue to do so in the future. Otsuka Holdings said that for the calendar year 2017, it would stick to the single-digit limit, but the company didn’t pledge to extend that beyond 2017.

Other companies replied but evaded the question. Sanofi, for instance, issued a statement saying that its objective was to ensure patients have access to its products – but that rings hollow if price continues to be a barrier to treatment.

Pharmaceutical corporations increase the prices of their products every year. In January 2017, median prices for prescription medications increased 8.9 percent on average – about four times higher than the overall inflation rate.

Some spikes were jaw-dropping and prompted a public outcry: Kaleo increased the price of Evzio, an anti-overdose device key to responding to the opioid epidemic, from $575 to $4,500 over three years, even though the device administers an old and inexpensive chemical; Mylan raised the price of EpiPen, a lifesaving device containing a century-old medication for people with severe allergies, from $103.50 in 2009 to $608.61 per package in 2016; and Turing Pharmaceuticals (of Martin Shkreli fame) raised the price of its 60-plus-year-old treatment for toxoplasmosis by 5,445 percent in 2015, from $13.50 to $750 per pill.

“Corporations abuse their monopoly power to charge people as much as we will pay to care for our loved ones,” Maybarduk added. “As a result, people are splitting pills, skipping much-needed medications and being forced to choose whether to buy groceries or pick up their prescriptions. It’s a painful and untenable reality that must change.”

On March 29, U.S. Sens. Al Franken (D-Minn.) and Sherrod Brown (D-Ohio) and 14 other Senate Democrats introduced the “Improving Access to Affordable Prescription Drugs Act,” which would curb the monopoly abuses of pharmaceutical corporations that keep prices high, including specifically by penalizing companies that boost prices. The bill also would allow Medicare to negotiate fair prices for seniors, reduce monopoly marketing periods and require transparency from the pharmaceutical industry. U.S. Reps. Jan Schakowsky (D-Ill.), Elijah Cummings (D-Md.), Peter Welch (D-Vt.) and Rosa DeLauro (D-Conn.) introduced companion legislation in the U.S. House of Representatives.

View the report.