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Pharmaceutical Companies Start New Year with Price Hike

While the overall average increase was 6.3 percent, the hike could push drug prices up 20 percent higher than in 2018 when its all done.

Dozens of drug makers plan to start the New Year by increasing prices on hundreds of drugs, researchers report this week.

While the overall average increase was 6.3 percent, the hike could push drug prices up 20 percent higher than in 2018 when its all done, according to an analysis published on Tuesday.

The analysis, by Rx Savings Solutions, shows nearly 40 drugmakers are expected to raise the prices of hundreds of medications this week, the Wall Street Journal reported.

“Drug companies promised they wouldn’t raise their prices in 2018, which was pretty disingenuous,” Jim Yocum, senior vice president at Connecture, who manages price transparency tools for Medicare.gov, told Bloomberg in December. “When the promises were made, it was a, ‘wink wink, nudge, nudge,’ situation to give the administration the response it wanted knowing full well that their next scheduled increase was in January.”

This increase is a make-up for companies like Pfizer, who held off on raising prices last year after receiving criticism from President Trump, analysts say.

“Now it’s time to play catch up,” Brian Rye, a senior health-care analyst at Bloomberg Intelligence, told Bloomberg. “They’re free to raise prices and the president is free to respond to them.”

And Allergan leads the pack, with drug prices raised by nearly 10 percent on 27 of its products and nearly 5 percent on 24 products. The drugs receiving increases include Alzheimer’s drug Namenda and dry-eye treatment Restasis.

The move could draw congressional pushback from Democrats who are scheduled to take control of the House this week.

In response to complaints that his administration wasn’t fighting price increases, Trump released in May a plan to drive drug costs down

“While individually companies may do well, the price increases taken together would suggest Pharma is ‘tone deaf’ to public concerns,” Bernstein analyst Ronny Gal told Bloomberg. “This is just around the time where the agenda for the upcoming Congress is being defined and action on drug costs is one option.”

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