AARP survey: Many generic medicine prices have risen sharply

Reversing a long-term trend, prices for more than one in four generic medicines widely used by older Americans increased in 2013, some very sharply, according to a survey by AARP.

Generic drug prices on average are still falling, but the increases for certain classes of drugs may be a sign of more to come, the advocacy group says, because industry consolidation is reducing competition, manufacturing quality problems are causing shortages and the number of blockbuster brand-name medicines going off patent has fallen since a huge surge a few years ago.

“This is the beginning of a shift,” Leigh Purvis, director of health services research in AARP’s Public Policy Institute, told The Associated Press.

About six of every seven prescriptions filled in the U.S. today are for generic medicines, as consumers, employers and health plans increasingly turn to generics to save money. At the same time, many insurance plans increasingly shift more of the medicine bill onto patients, through higher copayments and bigger deductibles.

AARP’s survey, being released Thursday, looked at price trends for 280 generic drugs commonly taken by Americans ages 50 and older — about 110 million people.

Roughly two-thirds of them take at least three generic drugs regularly. Many also take brand-name medicines. And the newest brand-name drugs for cancer, hepatitis C and some other conditions more common among older people cost around $100,000 for a year or course of treatment, compounding the financial strain.

“What we used to get from generics in the way of savings is going away at the same time that the prices of brand-name drugs are extremely high, and they’re going even higher . stratospheric,” Purvis said.

Between the end of 2012 and the end of 2013, the retail price for the 280 generic drugs decreased 4 percent on average for people with Medicare supplemental, employer and other health plans with negotiated price discounts. For people without prescription coverage, retail prices usually are higher.

The average price for a year’s worth of one medicine was $283, down from $510 in AARP’s survey of 2010 prices.

For about four-fifths of the 40 drug categories covered in the survey, generic prices decreased by 1 percent to as much as 58 percent in 2013. The largest decreases were for prescription vitamins, antiviral drugs, blood thinners, combination blood pressure drugs, enlarged prostate treatments, dementia drugs, sedatives and antidepressants.

However, prices increased for 75 generic drugs in the survey, or 27 percent, including 11 that jumped more than 30 percent. Two for treating infections had retail price increases of more than 1,000 percent, and the 18 infection treatments included rose by 44 percent on average.

Five other categories saw significant price jumps: one class of blood pressure drugs, seizure drugs, thyroid hormones, drugs for chronic heartburn and peptic ulcers, and miscellaneous cardiovascular drugs.

The increases were generally for drugs only sold by one or two generic drug companies. Prices generally stay low and even decline over time when three or more generics manufacturers are competing, as happens with generic versions of the most popular drugs. Recent examples include cholesterol fighter Lipitor, blood thinner Plavix and blood pressure drug Diovan.