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 Other drugmakers set to raise prices at the start of 2019 include
Allergan Plc <AGN.N>, GlaxoSmithKline Plc <GSK.L>, Amgen Inc <AMGN.O>,
AstraZeneca Plc <AZN.L> and Biogen Inc <BIIB.O>, the documents show.
The hikes will pose a new challenge to President Donald Trump's
pledge to lower the costs of prescription medications in the world's
most expensive pharmaceutical market.
The U.S. Department of Health and Human Services (HHS) has proposed
a slew of policies aimed at lowering prices and passing more of the
discounts negotiated by health insurers on to patients. Those
measures are not expected to provide relief to consumers in the
short-term, however, and fall short of giving government health
agencies direct authority to negotiate or regulate drug prices.
Twenty-eight drugmakers filed notifications with California agencies
in early November disclosing that they planned to raise prices in 60
days or longer. Under a state law passed last year, companies are
required to notify payers in California if they intend to raise the
U.S. list price on any drug by more than 16 percent over a two-year
period.
The details were provided to Reuters in response to a public records
request to California Correctional Health Care Services, which
provides healthcare services to the state's corrections department.
The department spends more than $3 billion annually on drugs for
inmates, more than any other state.
"Requests and public shaming haven't worked" to lower drug prices,
said Michael Rea, chief executive of RX Savings Solutions, which
helps health plans and employers seek lower cost prescription
medicines. "We expect the number of 2019 increases to be even
greater than in past years."
Pfizer Inc rolled back planned price increases in July after
President Trump said in a tweet that the drugmaker "should be
ashamed" and that his administration would respond to the hikes.
Pfizer said it would defer hikes until January 2019 to support the
administration as it pursued its new pricing policies. Pfizer's move
prompted many of its industry peers, including Bayer, Novartis,
Allergan, AstraZeneca and Amgen, to follow suit.
Drug price increases implemented by the 20 biggest drugmakers did
slow down during the second half of 2018, with those companies
raising prices on just over half the number of drugs as in 2017,
according to data compiled by consultancy RX Savings Solutions.
Pfizer has already announced plans to hike prices on 41 of its drugs
in mid-January.
60-DAY NOTICE
The California corrections department documents indicate that the
companies plan to increase prices as early as Jan. 1. Most do not
detail for which drugs or by how much, but specific details were
given in the case of Novartis and Bayer.
Novartis is planning to raise prices on more than 100 indications of
over 30 different drugs in January, the documents show, with
increases ranging from 4.5 percent to 9.9 percent. Drugs on the list
are expected to account for more than $20 billion of Novartis'
revenue this year and include multiple sclerosis drug Gilenya,
psoriatic arthritis treatment Cosentyx, and leukemia treatment
Tasigna.
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The list also includes Diovan, the brand name version of blood
pressure treatment valsartan, generic versions of which are
currently in shortage after a potential carcinogen was detected in
active ingredients made in China, prompting widespread recalls.
Novartis spokesman Eric Althoff said the company plans to raise U.S.
list prices on 14 percent of the medicines it sells in the country
in 2019, for an average increase of 4.7 percent on those drugs.
"Our rebates and discounts, however, continue to grow even faster,"
Althoff said. As a result, the company expects a net price decrease
of nearly 5 percent across the whole U.S. portfolio, he said.
Over the last three years, net price decreases for its U.S. business
have ranged from 2 percent to 2.6 percent, the company said.
Bayer filed notifications with California agencies to increase
prices on six of its drugs in January, many of which are birth
control products. Most of these price increases are 5 percent.
Bayer said that the U.S. wholesale price of its products are not
representative of what most consumers pay and that "list price
increases are expected to be offset by higher rebates and discounts
paid to insurance companies and pharmacy benefit managers."
Amgen did not respond to requests for comment. AstraZeneca and
Biogen declined to comment for this story.
GSK would not give details about its specific price increases, which
are set to take effect on or around Jan. 1 and could change before
then. Allergan said that all of its price increases will be aligned
with its pledge made in 2016 to limit drug price increases on its
products to less than 10 percent annually.
The United States, which leaves drug pricing to market competition,
has higher drug prices than in other countries where governments
directly or indirectly control the costs, making it the world's most
lucrative market for manufacturers.
Lowering prescription drug prices was a top priority in Republican
Trump's 2016 presidential campaign. Rival Democrats are expected to
step up congressional scrutiny of drug price hikes next year after
gaining control of the U.S. House of Representatives in elections in
November.
"Drug companies raising their prices and offsetting them with higher
rebates benefits everyone but the consumer," HHS spokeswoman Caitlin
Oakley said in a statement.
Trump and HHS Secretary Alex Azar "remain committed to lowering drug
prices and reducing out of pocket costs, and will continue to take
bold action to restructure this broken market," she said.
(Reporting by Michael Erman in New York and Robin Respaut in San
Francisco; Editing by Michele Gershberg and Sonya Hepinstall)
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