Eli Lilly says it’s cutting an average of 50% off list prices—and its price hikes don’t work
http://www.fiercepharma.com/pharma/lilly-s-average-rebates-and-discounts-swell-to-50-off-list-prices
Heightened pressure from pharmacy benefit managers and increased competition among drugmakers are taking a big bite out of Eli Lilly’s list-price hikes—an 11-percentage-point bite, on average, the company said in a new report.
After raising list prices an average of 14% in 2016, and wheeling and dealing with payers, Eli Lilly netted an overall price increase of 2.4%, the company said in a new report. That’s a major comedown from 2015, when a 16.3% average increase yielded a net rise of 9.4%.
Lilly joined pharma peers Johnson & Johnson and Merck in unveiling its high-level pricing data, as part of a summary of its annual report. On average, the company says discounts have grown to 50% over the last 5 years, up from 28% in 2012.
What’s causing that increase? Lilly says more competition among drugmakers to win coverage, a change in its product portfolio, and hardball negotiations with PBMs. Mandatory government discounts that have grown “significantly” since the Affordable Care Act went into law in 2010 are also playing a role, according to the company.
RELATED: Single-digit price-hike pledge? J&J has that covered already, company report says
The Indianapolis drugmaker’s report comes on the heels of Merck’s and J&J’s similar disclosures. Each of those companies has felt the sting of payer pressure in recent years, the disclosures show. On average, J&J said it hasn’t raised prices above a single-digit percentage—a pledge Allergan CEO Brent Saunders famously made in September—dating back to 2012. J&J paid out $11 billion in rebates and discounts in 2016 and realized a 3.5% average net price increase, the company said.
Merck reported that its average rebates and discounts grew to 40% in 2016, up from 27% in 2010. The company realized a 5.5% price gain throughout its portfolio last year, negotiated down from a 9.6% average list price increase.
RELATED: Big Pharmas, top biotechs balk at investor group’s push for pricing transparency
However, each company pushed back on a recent request from the Interfaith Center on Corporate Responsibility for more detailed pricing information. That group wants to see drug-specific pricing data, a request stymied by many top drugmakers.
RELATED: In quick rebuttal, Express Scripts blasts Gilead exec’s pricing blame
The companies are reporting their pricing and rebate data as debate continues to intensify over the role PBMs play in U.S. drug costs. Shortly after a high-profile dust-up between Gilead Sciences and Express Scripts on the topic, Sen. Ron Wyden. D-Ore., unveiled legislation aimed at lifting “the veil of secrecy” behind drug rebates.
Filed under: General Problems
Don’t you trust one thing these companies say , not one thing. They are crooks to the people in the USA. No Good.!