Drug Price Hikes Ring in 2018

Another year, another serious hike in drug prices. On January 1, 2018, a total of 1,305 prescription drugs increased in price. Manufacturers like Pfizer, Teva, Allergan, GlaxoSmithKline and Hospira were among those who raised prices.

As referenced in today’s Financial Times, drugmakers held the increases at less than 10 per cent for the most part, but they still tracked well ahead of inflation, currently 2.2 per cent in the US.

Raising prices at a rate that’s more than four times greater than inflation doesn’t typically qualify as good financial stewardship. In the world of prescription drugs, however, there is a different set of rules.

Many of these medications are essential, often life-saving, products that people need to stay alive and healthy. We have by far the most expensive healthcare system in the world, and the fastest-growing expense category of all is prescription drugs. For too many, it’s a time of shock and awe at the pharmacy counter this time of year. No doubt these price increases will stretch personal and household budgets across the nation.

As a retail pharmacist, I used to see families come in with great relief, finally having received a diagnosis for a difficult problem with a child, only to find that they can’t afford the prescribed medication. I also saw people’s lives transformed by getting the right treatment at the right time. And the difference wasn’t solely economic status. It was often just luck—one family prescribed an affordable drug, one family not—and with no clear way to get better, unbiased information.

In many cases clinical alternatives exist and can be utilized for a fraction of the price. Some services offer clinical suggestions to patients like those I described, but the options are often limited and skewed to what’s in the best interest of third parties.

What we’ve seen with drug price hikes on the first day of the year is only the most recent exploitation of the “market.” We simply don’t see this in other industries. The inelastic market of pharmaceuticals continues to be stretched.

Prices are being raised because there are no market forces to stop it. That’s why we want to change the landscape. Let’s use the power of technology to streamline how Americans purchase prescription drugs in the same ways it has transformed how consumers book travel, buy cars, or shop for electronics.

Like other consumer apps, Rx Savings Solutions does the price-checking for you, even proactively alerts you of the savings directly. Using patented algorithms to analyze thousands of recommendations to find the best clinical options and maximizing savings for users, we let you know where you can find the savings.

When consumers can afford the right medical therapies, they’re more adherent to a prescribed regimen. They’re less stressed. They take fewer sick days. They’re healthier, happier, more productive. The cost to employers and insurers goes down, and the healthcare system as a whole improves.

I’ve spent the last decade hacking the system, turning it upside-down, and shaking money out of its pockets for consumers —the desperate patients caught in the middle of a broken drug pricing system. 

The tumultuous drug price landscape for essential medications shouldn’t be the norm. Not in 2018, not ever. It needs to be fixed and we intend to do the work to make that a reality.

Michael Rea left his job as a pharmacist to pursue a solution to the runaway cost of prescription drugs, and is now helping companies and their employees save millions on their medications. See more in his TEDx Talk: “Why Prescription Drugs Cost So Much”