Pfizer to raise US drug prices in January after previously backing down under Trump pressure
NEW YORK: Pfizer Inc has recently announced that it plans to hike U.S. prices on 41 of its medicines in January, after walking back its previous planned price increases this summer under pressure from President Donald Trump.
The largest U.S. drugmaker said in a statement that the increases would be on around 10 per cent of its medicines.
Pfizer said it would raise the list price of most of the drugs by 5 per cent, while prices for three will rise by 3 per cent, and the price of one by 9 per cent, all effective Jan. 15. The company did name the drugs in line for price hikes.
Pfizer said it does not expect the price increases to boost its revenue in the United States next year as it believes that rebates to insurance companies and pharmacy benefit managers (PBMs) will offset them.
Chief Executive Ian Read said in the statement that the company believes the best way to make drugs more affordable is by focusing on reducing out-of-pocket costs and returning rebates to consumers. This would effectively place responsibility for lowering costs with PBMs and insurers, rather than drugmakers.
The company rolled back a set of price increases in July after Trump said in a tweet that the drugmaker "should be ashamed" and that his administration would respond.
Pfizer said then that it would defer price increases until the end of the year or until the president's drug pricing plan went into effect, whichever was sooner.
It was not immediately clear whether other drugmakers plan to follow suit. Several, including Roche, Merck & Co and Novartis, made similar pledges not to raise U.S. prices before the end of the year.
Merck and Novartis could not immediately be reached for comment, while a spokeswoman for Roche's Genentech unit declined to comment.
Pfizer did not tip off the administration that the latest round of price increases was coming, according to a source familiar with the matter.
The hikes "illustrate the perverse incentives of America's drug pricing system," said Department of Health and Human Services (HHS) spokeswoman Caitlin Oakley.
"Drug companies raising their prices and offsetting them with higher rebates benefits everyone but the consumer," she said, noting that HHS and the Trump administration was committed to lowering drug prices.
Read Also: Pfizer Q2 net profit falls 14% to Rs 95.8 crore
Medical Dialogues Bureau consists of a team of passionate medical/scientific writers, led by doctors and healthcare researchers. Our team efforts to bring you updated and timely news about the important happenings of the medical and healthcare sector. Our editorial team can be reached at firstname.lastname@example.org. Check out more about our bureau/team here