Drugmakers raise prices in US within self-imposed limits

NEW YORK: Drugmakers opened the new year by raising U.S. prices on dozens of medicines, but early data showed the increases generally remained within a 10 percent self-imposed limit in response to a backlash from consumers and politicians.

Soaring U.S. prices for both branded and generic drugs have sparked public outrage and government investigations over the past few years.

"Drug price increases are somewhat more constrained in 2017 and 2018 than they have been previously," Cowen and Co analyst Eric Schmidt said.

Allergan Inc raised prices on 18 different drugs, including dry eye treatment Restasis and irritable bowel syndrome drug Linzess, by 9.5 percent, according to a research note released by Jefferies on Tuesday.

Jefferies cited data collected by Medi-Span Price Rx and refers to list price increases, before potentially significant discounts and rebates that drugmakers provide to win preferred coverage by insurers. Medi-Span did not respond to requests to confirm the data.

Allergan's chief executive, Brent Saunders, in late 2016 pledged to keep price increases below 10 percent as part of what he called the company's "Social Contract with Patients."

Allergan spokesman Mark Marmur said the increases will be the only ones taken on those brands in 2018, adding that discounts to various payers should bring the actual increases to consumers down to the low single digits.

Other drugmakers raising prices include Amgen Inc, Teva Pharmaceutical Industries Inc and Horizon Pharma, according to Jefferies and Cowen. Amgen raised the price on its blockbuster rheumatoid arthritis and psoriasis drug Enbrel by 9.7 percent and Teva increased prices on its ProAir HFA and ProAir RespiClick asthma inhalers by 6 and 3 percent, respectively.

Drug price increases are coming under more scrutiny from states. California Governor Jerry Brown in October signed legislation requiring drug manufacturers to give the 60-day notice if prices are raised more than 16 percent over a two-year period.

Shares of Allergan rose 4.1 percent on Tuesday, while Teva and Horizon Pharma shares were up 0.8 percent and 2.9 percent, respectively.

(Reporting by Michael Erman; Editing by Leslie Adler)