New UMN Research Examines Rising Antibiotic Prices, Limited Competition

Skyrocketing prescription drug prices have saddled many families with unforeseen financial challenges, sometimes forcing patients to pick between a needed medication and paying their mortgage. Since 2010, drug prices have risen 24 percent, according to the Bureau of Labor Statistics.

New University of Minnesota Medical School research, published in Clinical Infectious Disease, shows that even some important generic antibiotics have experienced troubling price increases. 

“Everyone has heard stories about expensive drugs for rare diseases and we have known that even some generic drugs for these diseases can be high,” said Jonathan Alpern, MD, who led the research as an infectious disease fellow at the University of Minnesota Medical School. “But the generic antibiotic market has not been well studied.” 

Alpern, along with Professor William Stauffer, M.D., within the Division of Infectious Disease and other colleagues looked at 81 formulations of generic antibiotics between 2013 and 2016. On the whole, prices remained stable for the majority of drugs. But, 14 percent of the drugs in the study saw an increase of 90 percent or more over the four years, and 16 percent of the drugs had two or fewer manufacturers.

The limited generic competition, Alpern says, allows manufacturers to drive up the cost of drugs.

The rising cost of drugs is not a minor financial inconvenience. It has major implications for patient health.  Price hikes create a major barrier to accessing appropriate antimicrobial treatment which can result in delayed treatment, complications and higher overall cost to the health system—such as hospitalization, prolonged inpatient care or intravenous antibiotics, or even result in fatal outcome.

A Case Study in Chagas Disease

In a second study, recently published in PLOS Neglected Tropical Diseases, Alpern, Stauffer and colleagues explored the potential for a price hike of a drug called benznidazole, which is a first-line defense for Chagas disease.

Currently, the Centers for Disease Control and Prevention (CDC) make it available to patients for free under an investigational new drug protocol, but two companies are pursuing approval and licensing rights from the FDA. If approved, the winning company has the freedom to charge a premium for the drug, making it inaccessible for many patients.

“While it’s reassuring that both companies have pledged to price benznidazole affordably, should they obtain FDA approval, manufacturers of anti-parasitic drugs in the U.S. have been notorious for steep price increases,” Alpern said. “The reality is, when there’s little competition, the marketplace is ripe for hikes.”

There’s No Easy Prescription for Solving Price Hikes

While it is unlikely that rising drug prices can be reversed, Alpern and colleagues point to a few measures that could slow the pace of price increases.

The Food and Drug Administration is already crafting policies that should be helpful, like expediting certain applications for generic drug manufacturers.

States are also working to tackle the issues. In Maryland, for example, lawmakers passed a law to prevent price hikes in situations where there’s limited competition.

Lastly, Alpern and colleagues suggest the FDA could consider faster approval of drugs that are already approved in other countries. This could increase competition and drive down prices.

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