Pfizer, GSK & Others Quietly Hike Prices On 100s Of Drugs

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Just hours into the new year, Reuters reports that a group of the world's largest drug companies is preparing to hike drug prices, defying President Trump to issue a last-minute rebuke, as he has done in the past.

Drugmakers including Pfizer Inc, Sanofi SA, and GlaxoSmithKline Plc plan to raise U.S. prices on more than 300 drugs in the United States on Jan. 1, according to drugmakers and data analyzed by healthcare research firm 3 Axis Advisors.

The hikes come as drugmakers are reeling from effects of the COVID-19 pandemic, which has reduced doctor visits and demand for some drugs. They are also fighting new drug price cutting rules from the Trump administration, which would reduce the industry’s profitability.

The companies kept their price increases at 10% or below, and the largest drug companies to raise prices so far, Pfizer and Sanofi, kept nearly all of their increases 5% or less, 3 Axis said. 3 Axis is a consulting firm that works with pharmacists groups, health plans and foundation on drug pricing and supply chain issues.

During the early days of the Trump presidency, reports of price hikes elicited angry tweets from the president. This dynamic was credited with staving off a hike or two, but that doesn't change the fact that drug companies tend to raise prices on their inventory at least once, usually twice, per year. Still, even Reuters pointed out that the pace of drug price increases has "slowed substantially" since 2015, per Reuters.

And the Trump Administration is pushing legislation that would constrain drugmakers' ability to raise prices.

Nevertheless, with drugmakers' dedicating themselves to defeating COVID-19 (of course, the state has doled out billions of dollars in subsidies, which sort of diminishes the selflessness narrative), the industry is insisting that profits must be made up elsewhere. So prices on some 300 drugs will rise, with more formal announcements expected on Friday, and over the weekend.

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