Sun Sentinel Palm Beach Edition
Drug companies on the defensive over price rises
TRENTON, N.J. — Several big drug makers are trying to quell the furor over high drug prices by revealing more information about their pricing and even pledging to keep a lid on increases.
No one should expect to be paying less for medicine any time soon, experts say, though the drug makers’ response to public pressure may help slow the rise in prices for some drugs.
The latest drug maker move came this week, when Johnson & Johnson, the world’s biggest maker of health care products, issued its first public report on price increases for its drugs.
The drug industry’s top two lobbying groups have been running advertising campaigns that reinforce a point the industry has long pushed: Medical breakthroughs that improve or save patients’ lives are very difficult — and expensive — and high prices are needed to fund research into new treatments.
But now individual companies are making their own cases to the public in hopes of showing that at least they aren’t as bad as some others.
This week, Johnson & Johnson reported that over the past five years, the list price, or retail price, of its drugs rose less than 10 percent each year on average, while the net price, the payment it receives after discounts and fees insurers and other middlemen get, rose 5 percent or less per year.
But J&J’s increase is still more than double the U.S. rate of inflation, which means its prices rose far faster than prices for other goods and services.
Johnson & Johnson’s disclosure is the latest in a string of similar moves.
For example, Sanofi SA, maker of top-selling insulin Lantus, reported last month that last year its list prices increased by 2.3 percent on average, but its average net price dipped 0.5 percent because insurers got discounts that averaged 50 percent.
And Merck & Co. in January reported its annual net price increase since 2010 has ranged from 3.4 percent to 6.2 percent, roughly half its list price increases, while its average discount to payers climbed to 41 percent in 2016.