News Capsules

NOVEMBER 01, 2008

Specialty Rx Prices Continue to Climb

The prices of specialty drugs most commonly used by Medicare Part D beneficiaries have risen faster than inflation every year since 2004. In 2007, the price hike was 8.7%, or nearly 3 times the general rate of inflation, according to a report recently released by the AARP.

Specialty drugs are used to treat complex, chronic conditions and are currently among the most expensive on the market, with prices that can range from $5000 to >$300,000 per year, the AARP noted.

"The skyrocketing cost of specialty drugs is especially tragic for those suffering from diseases like cancer and multiple sclerosis," said John Rother, AARP executive vice president of policy and strategy. "These drugs can provide comfort and hope to these individuals and their families, but even the most miraculous drug is useless if a person can't afford to take it."

The Generic Pharmaceutical Association (GPhA) agrees and believes that Congress needs to give the FDA the authority to create a pathway for biogenerics. "Without competition, there can be no hope of relief for patients who need these and many other biologic products," stated Kathleen Jaeger, president and chief executive officer of GPhA. "This study proves what we have consistently stated—generic competition creates substantial savings for patients."

Flat-Rate Generics Popular, Survey Finds

The rise of flat-rate generic prescription pricing plans that charge a fixed price is creating higher satisfaction for individuals at "brick and mortar" pharmacies who participate in these programs, according to the 2008 National Pharmacy Study by JD Power and Associates.

Approximately one quarter of all pharmacy patients are taking advantage of these discount plans, according to the study, with the highest numbers drawn from patients aged 44 and older who especially like the predictability of low prices for generic prescriptions, study analysts noted.

The study also found that health insurance and Medicare Part D have driven more seniors to use mail-order pharmacies to obtain medications for managing chronic conditions. Patients aged 65 and older requested 26% of mail-order prescriptions in 2008. For more information, go to

Kudos for CA E-pedigree Law

The Generic Pharmaceutical Association (GPhA) is praising the passage of legislation that will establish an electronic pedigree (e-pedigree) system in California aimed at helping to maintain the security of the drug distribution chain against counterfeit drugs.

GPhA has been working with a coalition of members throughout the entire drug supply chain to develop solutions to strengthen the pharmaceutical tracking system. The coalition has been conducting pilot studies to determine what systems would be feasible for patients and the health care system.

Under the California law, brand and generic manufacturers would commence providing e-pedigree and serialization of their products in 2015. "This implementation will help manufacturers [in] establishing an electronic track and trace system," noted Kathleen Jaeger, GPhA president and chief executive officer.

"Doughnut Hole" Leads Seniors to Generics

A recent study by Medco Health Solutions found that, when patients being treated for high cholesterol hit Medicare Part D's "doughnut hole," they were twice as likely to abandon their medications. Those taking brand name cholesterol-lowering statins were most at risk of stopping therapy once they hit the coverage gap.

The study shows that, during 2007, the rate of patients who suspended generic statin treatment was 20% lower than those on a brand name medication. The analysis also revealed that reaching the coverage gap stimulates the use of generics among all Medicare recipients. During the initial phase of the benefit, when the plan provides drug coverage, one third of the medications used daily by beneficiaries were generics, and two thirds were brand name drugs. Once beneficiaries reached the coverage gap, however, generic use rises to 71%, and brand name use falls to 29%.

In light of these findings, Generic Pharmaceutical Association President and Chief Executive Officer Kathleen Jaeger urged physicians, health care providers, and payers to educate patients about the availability and value of generic medicines.

"It is a tragedy that our seniors are forgoing taking needed medicines because they can no longer afford them. Generic medicines can stretch scarce resources and provide a life jacket for those seniors who are at risk of stopping their medication when they reach the doughnut hole," Jaeger said.