Skip to main content

Brand-Name Prescription Drug Pricing: Lack of Therapeutically Equivalent Drugs and Limited Competition May Contribute to Extraordinary Price Increases

GAO-10-201 Published: Dec 22, 2009. Publicly Released: Jan 11, 2010.
Jump To:
Skip to Highlights

Highlights

The growing cost of brand-name prescription drugs--FDA-approved drug products that typically have patent protection--is a concern for patients, payers, and providers of health care--particularly when price increases are large and occur suddenly. A 2008 congressional hearing by the Joint Economic Committee drew attention to some small market prescription drugs that had an extraordinary price increase--a price increase of 100 percent or more at a single point in time. GAO was asked to examine extraordinary price increases for brand-name prescription drugs. Specifically, GAO examined the: (1) frequency of extraordinary price increases for brand-name prescription drugs from 2000 to 2008, (2) characteristics of the brand-name prescription drugs that had extraordinary price increases, and (3) factors that contributed to the extraordinary price increases experienced by these brand-name prescription drugs. To determine the frequency and characteristics of the brand-name prescription drugs that experienced an extraordinary price increase, GAO reviewed drug pricing and other data from a pharmaceutical industry compendium. To illustrate the factors that may contribute to extraordinary price increases, GAO developed case studies of six brand-name prescription drugs identified from the analysis of drug pricing data. These brand-name prescription drugs were selected based on factors including price, and the percentage and number of price increases.

Full Report

Office of Public Affairs

Topics

CompetitionCorporate mergersCost analysisCost controlDrug pricingSubstance abuse treatmentFair market valueGeneric drugsManufacturing industryPatentsPharmaceutical industryPharmacological researchPrescription drugsPrice regulationPrices and pricingResearch and development costsTherapyPrice increases