Drugmakers, Including Pfizer and Sanofi, Set to Raise US Prices on at Least 500 Drugs in January

By Jace Dela Cruz

Dec 30 2023, 01:55 AM EST

Several major drug companies, including Pfizer, Sanofi, and Takeda Pharmaceutical, are gearing up to implement price hikes on over 500 drugs in the United States in early January, according to data analyzed by healthcare research firm 3 Axis Advisors.

The data revealed that more than 140 brands of drugs will increase their prices next month. According to Reuters, the expected price hikes come as the pharmaceutical industry prepares for the Biden administration to unveil discounted prices for 10 costly medicines in September and continues to struggle with higher inflation and manufacturing costs.

Drugmakers, Including Pfizer and Sanofi, Set to Raise US Prices on at Least 500 Drugs in January — Several major drug companies, including Pfizer, Sanofi, and Takeda Pharmaceutical, are gearing up to implement price hikes on over 500 drugs in the United States in early January. Ri Butov from Pixabay

Joe Biden's Medicare Health Program Can Negotiate Prices Directly for Some Drugs

President Joe Biden's health program under the Inflation Reduction Act of 2022, allowing Medicare to negotiate drug prices directly with manufacturers, will face major tests in 2024.

The actual negotiation period is set to start on February 1 and will focus on the first round of 10 prescription drugs to make those pricey treatments more affordable for older Americans.

In August, the Centers for Medicare & Medicaid Services (CMS) identified the initial 10 drugs subject to price talks, which included diabetes drugs from Merck and AstraZeneca and blood thinners from Bristol Myers Squibb and Johnson & Johnson. The agreed-upon prices will be published on September 1 and will go into effect in 2026.

The pharmaceutical industry is reportedly now worried about potential disruptions to supply chains due to a prolonged conflict in the Middle East, with shipping companies forced to stop or reroute traffic from the Red Sea, a major global trade artery, with about 10% of the world's trade passing through it.

Drugmakers Increasing Prices

Drugmakers have maintained their price increases at 10% or below, a practice followed by many big companies after they came under fire for numerous price hikes in the middle of the last decade.

According to 3 Axis president Antonio Ciaccia, the prices of drugs in the last five years have been "basically" the same despite high inflation rates, except for newly launched drugs, whose prices have hit record levels.

Data from drug pricing non-profit 46brooklyn shows that price increases have hovered at around 5% since 2019. The data also reveals that drugmakers increased prices on 1,425 drugs this year, lower than in 2022 when prices of 1,460 medicines were raised.

Next month, Pfizer is expected to increase the prices of 124 drugs and put an additional increase on 22 medications at its Hospira arm. Factoring out different doses and formulations, Pfizer and Hospira will reportedly raise the prices of 30 and six branded drugs, respectively.

The New York-based drugmaker has reportedly announced the most January price increases, accounting for over a quarter of all the drugs with hikes planned.

According to Reuters, Takeda-owned Baxalta will have the second-highest number of price increases, with 53 hikes planned so far, followed by Belgian firm UCB Pharma, which plans to increase prices on 40 unique drugs.

Eight branded drugs from Baxalta and six branded medicines from UCB will reportedly have their prices raised next month after different doses and formulations are discounted.

Sanofi, which vowed to lower 2024 prices on most of its prescribed insulin products earlier this year, will notably increase the prices of its typhoid fever, rabies, and yellow fever vaccines by 9% each next month.