* Wal-Mart raised brand drug prices 32 pct over 2008-2010
* Kmart branded prices rose 35 pct over same period
* Average pharmacy branded drug price increase was 21 pct
By Deena Beasley
SAN DIEGO, June 25 (Reuters) - Big-box retailers Wal-Mart Stores (WMT.N) and Kmart, pioneers in the push to cut consumer prices for generic drugs, have been raising prices for the most popular brand-name diabetes drugs, according to a new study.
Wal-Mart, the world's largest retailer began in 2006 to sell some generic drugs in the United States for $4 per monthly prescription -- a tactic since adopted by a number of other pharmacy operators.
"Since 2008, everybody has lowered generic prices to the level of Wal-Mart," said Dr. Ronald Tamler, an endocrinologist at New York's Mount Sinai Medical Center, and co-author of the price study. "But the differential in pricing for brand-name drugs is huge."
His study, presented here at the annual meeting of the American Diabetes Association, found that pharmacy prices for generic diabetes drugs fell 58 percent between 2008 and 2010, compared with an increase of 113 percent for brand-name drugs.
The study also showed that Wal-Mart has raised prices for the 10 most-prescribed diabetes treatments by 32 percent between 2008 and 2010, compared with an average industry-wide increase of 21 percent, which includes chain drugstores, mail-order firms and independent pharmacies.
Kmart, a unit of Sears Holding Corp (SHLD.O), raised its prices by 35 percent over the same two-year period, according to the study.
Neither company responded to a request for comment.
The $4 generics have become a "loss leader" for stores looking to draw new customers, Dr. Tamler said.
"The message used to be to send uninsured and underinsured patients to Wal-Mart to get a great deal on generic drugs," he said. "Now, the message is to tell patients to shop around for their medications."
Editing by Paul Simao