HQ Team
December 13, 2024: The Institute for Clinical and Economic Review (ICER) has released a new report revealing that five high-expenditure drugs in the United States experienced significant price increases in 2023 without adequate clinical evidence to justify the hikes. This has resulted in an additional $815 million in costs to the healthcare system.
Key findings of the ICER report
The report identified Biktarvy, Darzalex, Entresto, Cabometyx, and Xeljanz as the five drugs with substantial price increases that lacked new clinical evidence to support their higher costs.
These unsupported price increases contributed to an estimated $815 million in additional expenses for U.S. payers over the past year.
Foluso Agboola, ICER’s Vice President of Research, noted that while there has been a decrease in drugs with significant price hikes unsupported by new evidence since the report’s inception in 2019, the current findings still reflect concerning trends in drug pricing.
ICER identified the top 10 drugs with notable price increases based on their sales revenue: only the top 250 drugs were considered; those with Wholesale Acquisition Cost (WAC) list price increases exceeding inflation rates; and those medicines whose net price increases significantly impacted overall spending.
The ICER report indicates that the list price increases for these drugs were far above the consumer price index plus 2%, which raises questions about their justification in relation to general economic conditions.
After reviewing evidence from manufacturers and published studies, ICER concluded that half of the assessed drugs had price increases justified by new evidence of additional benefits, while the other half did not.
Implications for patients and healthcare
The report emphasizes that excessive drug pricing affects patients and families across the country. With many high-cost medications lacking sufficient evidence for their increased prices, there is growing concern about affordability and access to necessary treatments. Agboola stated, “These price hikes resulted in over $800 million in excess costs to the U.S. healthcare system in just one year alone.” This highlights the urgent need for transparency and accountability in drug pricing.
Market dynamics
The pharmaceutical market often allows for price increases without corresponding evidence of improved outcomes. Companies may raise prices based on market positioning or profit motives rather than clinical necessity or enhanced therapeutic benefits.
The current regulatory framework is not equipped to prevent unjustified price increases, allowing pharmaceutical companies to adjust prices based on business strategies rather than patient needs or clinical advancements.
There is a longstanding trend in the pharmaceutical industry where high-cost drugs routinely see price increases that are not always aligned with new data or improvements in patient care, perpetuating a cycle of rising healthcare costs without corresponding benefits.
The ICER report sheds light on the ongoing issue of unsupported price increases in prescription drugs. As healthcare costs continue to rise, it is essential for stakeholders to advocate for fair pricing practices based on clinical evidence to ensure patients receive effective and affordable treatments.
