WSJ: Prices Increase on Popular Drugs

[question everything]

Prices Increase on Popular Drugs
Majority of Top-Selling Medicines Cost
More Since Election; a 5% Rise for Lipitor

By HEATHER WON TESORIERO and SCOTT HENSLEY
Staff Reporters of THE WALL STREET JOURNAL
January 25, 2005

(snip)

After a summer lull ahead of the politically sensitive election season, drug companies have resumed their price increases. Drug makers of course often raise prices, in part to cover rising costs, but analysts say a greater number of top-selling drugs have had price increases in the past few months, with many surpassing economists' estimate for consumer inflation this year of 2.5%.

(snip)

Of the 50 biggest-selling medicines in the drug industry, 31 had price increases since the November elections through Jan. 19, according to Delta Marketing Dynamics, a price-tracking firm in East Syracuse, N.Y. In the same period a year earlier, only 22 of the top 50 drugs had price increases.

In part, companies are raising prices to make up for huge sales losses, or impending ones, from generic competition. A number of big-selling drugs, including Pfizer's antibiotic Zithromax are expected to lose patent protection this year.

But prices have also risen in advance of the Medicare drug benefit, slated to begin next January, which is expected to put downward pressure on prices as the government seeks to rein in costs. This is a crucial year for drug makers, and the current round of increases could set the tone for 2005. "They could come out aggressively to set the floor higher" for the coming price negotiations with the government, said Bill Little, president of Delta Marketing Dynamics.

(snip)



Write to Heather Won Tesoriero at [e-mail] and Scott Hensley at [e-mail]

URL for this article:
http://online.wsj.com/article/0,,SB110660935876234608,00.html

[question everything]

1. It is a given, of course, that the drug companies are a major donor

to Bush and co.

[Ripley]

2. I swear I saw a recent LBN headline about them cutting prices.

Was that another Big Lie?

[question everything]

4. This might have been special cards for seniors

I think that seniors on Medicare do not have to sign on the new program - don't have to worry about that, yet - so if they can show that seniors do flock to them they can justify the no-bids deal.

Am not sure.

[TexasSissy]

3. The government is prohibited by law from negotiating the prices.

So I don't know what they're worried about on that end. IMO, they are not increasing prices in preparation for having to lower them. They are increasing prices in anticipating of getting a huge order for the drugs at existing price levels, which they know the government HAS to pay.

Our tax dollars at work.

[dqueue]

5. On the other hand...

there was a post within the past few weeks which indicated that prices are dropping on popular street-drugs...