Median price of newly approved drugs topped $200,000 last year, analysis finds
Abigail Adcox
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Drug manufacturers marketed new medicines at soaring prices last year, with the median price of newly launched drugs exceeding $200,000, topping price trends from 2021, according to a new analysis from Reuters.
In the first half of the year, the median annual price of 13 drugs the Food and Drug Administration approved for chronic conditions, including diabetes and anemia, was $257,000. That’s up roughly $77,000 from the median price of 30 drugs marketed through mid-July in 2021, which was $180,000, according to a separate study published in JAMA.
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However, skyrocketing price trends appeared to slow in the second half of last year as the median price of 17 novel drugs introduced on the market since July decreased to $193,900, per Reuters.
During that time, the FDA approved Hemgenix, a $3.5 million gene therapy for adults with hemophilia B, making it the most expensive drug in the world. Another new drug was Eli Lilly’s drug Mounjaro, which was approved to treat Type 2 diabetes.
The analysis, which excluded certain drugs such as those that have not been marketed commercially, indicated that there has been a double-digit increase in drug prices year over year.
Last year also stood out because the FDA approved just 37 novel drugs in total, the smallest amount since 2016. In 2021, the agency greenlighted 50 novel drugs.
The FDA’s drug approval process has come under increased scrutiny since 2021 when it cleared Biogen’s controversial Alzheimer’s drug, Aduhelm, despite concerns over its effectiveness. The drug has since faced challenges on the market with an initial price tag of $56,000 annually, which was later cut by Biogen, and Medicare significantly limiting coverage of the drug.
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Congress took steps last year to mitigate the impact of rising drug prices due to inflation with the Inflation Reduction Act. It allows Medicare to negotiate the price for some of the costliest drugs on the market and requires drug companies to pay rebates if prices increase faster than inflation for drugs used by Medicare enrollees.
Critics of the Democratic-led legislation argued that the drug provisions could prompt pharmaceutical companies to seek higher initial prices for new drugs.