Dermatology drug prices in U.S. soared in recent years

(Reuters Health) - The price of many drugs prescribed by U.S. dermatologists has skyrocketed over the past six years, far exceeding increases in overall health care costs and stretching patients’ budgets in an era of high insurance deductibles, according to a new study from Florida.

Of the 19 drugs analyzed, price increases between 2009 and 2015 ranged from about 60 percent to 1,698 percent, with an average rise of more than 400 percent.

“It was shocking to us when we saw some of the prices,” said senior author Dr. Steven Rosenberg, who is a voluntary professor of dermatology at the University of Miami Miller School of Medicine. “We double checked with the pharmacies to make sure they were accurate.”

Drug prices recently became a topic of national debate after Turing Pharmaceuticals increased the price of an older antimicrobial medicine by more than 5,000 percent. The company announced yesterday it would reduce the cost of the drug for hospitals. (See Reuters story of November 24, 2015 here:

Authors of the new study write in JAMA Dermatology that Americans are increasingly forced to pay out-of-pocket for drugs as insurance programs cut back on the number of drugs they cover and implement high deductibles.

About one in five Americans in 2014 reported not filling at least one prescription due to cost, they note.

To assess trends in dermatology drug prices, the researchers asked pharmacies at Costco, CVS, Sam’s Club and Walgreens in the West Palm Beach area about the retail prices of certain brand-name drugs in 2009. The survey was repeated in 2011, 2014 and 2015.

While the researchers collected data on about 100 drugs, they narrowed the current analysis to 19 for which they had information spanning all four surveys.

The drugs fit into five categories, including drugs to treat skin cancer, infections, acne and rosacea, psoriasis or other skin conditions like itching and eczema.

The prices of seven drugs more than quadrupled during the study period, the researchers found. Most increases occurred after 2011.

Medications used to stop the growth of cancer cells increased by about $11,000 per year or 1,240 percent, which was the biggest rise for a single class of drugs. The smallest price jump occurred among drugs that treat infections, which increased about $334 per year, or about 180 percent.

Even some generic drugs, which are known to be less expensive than brand-name medications, rose in price between 2011 and 2014, the researchers report.

The new study was not designed to evaluate why prices may have changed over the six years.

“I think they’re charging what they want to, because they can,” Rosenberg said of pharmaceutical manufacturers. “I think that’s the simplest answer.”

While private insurance companies can negotiate drug prices with pharmaceutical companies, Rosenberg pointed out, the U.S. government has no control over drug prices even though it oversees the nation’s two public insurance programs - Medicare and Medicaid.

“What’s going on with the prescription drug pricing is just going to bankrupt healthcare,” he said. “It’s not sustainable.”

In a related commentary, Dr. William Eaglstein of the Miller School of Medicine at the University of Miami points to the increasing difficulty of getting drugs approved as a major source of rising costs to develop new ones.

Frank Lichtenberg, a professor at Columbia Business School in New York City who wasn’t involved in the new study, told Reuters Health that “the amount paid out of pocket by insured customers is considerably lower, and may have increased much less,” than the retail prices.

“I would also like to point out that I have shown in numerous studies that, in general, pharmaceutical innovation - the introduction and use of new drugs - is highly cost-effective and may often be cost-saving,” Lichtenberg said by email.

Nonetheless, Rosenberg told Reuters Health, the current study shows someone is paying more for these drugs.

“Down the road, I think the insurance industry is going to shift the cost to the patient,” he said.

SOURCE: and JAMA Dermatology, online November 25, 2015.