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GAO-11-306R 1 (2011-02-10)

handle is hein.gao/gaobaanwi0001 and id is 1 raw text is: ~G A 0 A o bintbihty I integrity I Rehalblity United States Government Accountability Office Washington, DC 20548 February 10, 2011 Congressional Requesters Subject: Prescription Drugs: Trends in Usual and Customary Prices for Commonly Used Drugs Prescription drug spending in 2009 totaled approximately $250 billion, of which $78 billion- or about 31 percent-was spent by the federal government.' Prescription drug spending by the federal government, patients, and third-party payers, including employers, is driven by many factors, including the prices paid for drugs. In 2007 we reported on trends in retail prices-known as usual and customary (U&C) prices-for prescription drugs.2 We found that the average U&C price for the commonly used brand-name prescription drugs we reviewed increased about 6 percent per year from January 2000 through January 2007.' Some media reports4 have suggested that prescription drug prices may have increased more during the debate leading up to passage of the Patient Protection and Affordable Care Act (PPACA) in March 2010 compared to other recent years.5 We were requested to examine recent trends in drug prices for brand-name and generic pharmaceuticals. In this report, we (1) examine U&C price trends for commonly used prescription drugs from 2006 through the first quarter of 2010, the latest available data at the time of our analysis, and compare these trends to those of other medical consumer goods and services, and (2) examine price trends using drug prices other than U&C. You also asked us to provide information on the extent to which prices for individual brand-name drugs changed over the course of this analysis period. We have provided this information in an enclosure. NHE Web Tables, National Health Expenditures data for 2009 (the most recent available at the time of our analysis), http://www.cms.gov/nationalhealthexpenddata/02-nationalhealthaccountshistorical.asp (accessed Jan. 20, 2011). 2The U&C price is the price an individual without prescription drug coverage would pay at a retail pharmacy. 3See GAO, Prescription Drugs: Trends in Usual and Customary Prices for Drugs Frequently Used by Medicare and Non-Medicare Health Insurance Enrollees, GAO-07-1201R (Washington, D.C.: Sept. 7, 2007). For additional GAO reports on drug pricing, see Prescription Drugs: Trends in Usual and Customary Prices for Drugs Frequently Used by Medicare and Non-Medicare Enrollees, GAO-05-104R (Washington, D.C.: Oct. 6, 2004) and Prescription Drugs: Price Trends for Frequently Used Brand and Generic Drugs from 2000 through 2004, GAO-05-779 (Washington, D.C.: Aug. 15, 2005). 4See Duff Wilson, Drug Makers Raise Prices in Face of Health Care Reform, The New York Times, Nov. 16, 2009 and Emily Brandon, Drug Prices Outpace Inflation, US News, Nov. 17, 2009. 5Pub. L. No. 111-148, 124 Stat. 119 (2010). GAO-11-306R Prescription Drug Price Trends

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