Findings show the impact of drug companies’ relentless price increases, underscoring the importance of the changes included in the historic 2022 drug law
WASHINGTON, Jan. 9, 2025 /PRNewswire/ — List prices for the 25 top Medicare Part D drugs not currently selected for Medicare drug price negotiation have increased by an average of 98 percent—or nearly doubled—since they first entered the market, according to a new report from AARP’s Public Policy Institute released today. The report also found that, on average, more than 40 percent of the current list prices for the top 25 drugs is due to price increases that have occurred after the products first entered the market. These findings highlight the importance of a 2022 law that addresses high prescription drug prices and drug price increases.
“Brand-name drug prices have been increasing faster than the rate of general inflation for decades, putting life-saving medications out of reach for millions of patients who need them,” said Leigh Purvis, Prescription Drug Policy Principal, AARP Public Policy Institute, and author of the report. “Meanwhile, the median price of a new brand name prescription drug is now approximately $300,000 per year, so even a small price change could increase a drug’s price by thousands of dollars.”
This analysis focuses on the 25 brand-name drugs with the highest total Medicare Part D spending in 2022 that have not yet been selected for Medicare drug price negotiation. Combined, these top 25 drugs accounted for nearly $50 billion in total Medicare Part D spending in 2022 and were used by a total of more than 7 million Part D enrollees. The top five medications include:
Congress passed the Inflation Reduction Act in 2022, which includes two major provisions designed to address high prescription drug prices that are expected to reduce Medicare Part D enrollee and program spending by billions of dollars. The first requires drug companies to pay penalties to Medicare if their drug prices increase faster than the rate of inflation. The law also gave Medicare the ability to negotiate lower drug prices with drug companies for the first time. The negotiated prices for the initial 10 drugs selected by the Centers for Medicare & Medicaid Services will take effect in January 2026, and up to 15 more drugs will be selected for negotiation by February 1, 2025.
To view the full report, visit here.
About AARP
AARP is the nation’s largest nonprofit, nonpartisan organization dedicated to empowering people 50 and older to choose how they live as they age. With a nationwide presence, AARP strengthens communities and advocates for what matters most to the more than 100 million Americans 50-plus and their families: health security, financial stability and personal fulfillment. AARP also produces the nation’s largest circulation publications: AARP The Magazine and AARP Bulletin. To learn more, visit www.aarp.org/about-aarp/, www.aarp.org/español or follow @AARP, @AARPenEspañol and @AARPadvocates on social media.
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SOURCE AARP
