Drugmakers to raise prices of 350 drugs at start of 2023

Drugmakers are set to raise the prices of 350 drugs at the beginning of 2023.

Pfizer, GlaxoSmithKline PLC, Bristol Myers Squibb, AstraZeneca PLC, and Sanofi SA are among several drugmakers set to raise prices, according to healthcare research firm 3 Axis Advisors, Reuters reported. The price hikes are in response to a number of factors, mainly inflation, supply problems, and the Biden administration’s Inflation Reduction Act, which will allow Medicare, the national government’s health insurance program for seniors and people with certain disabilities, to negotiate several drug prices directly starting in 2026.

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Drug manufacturers usually try to avoid major price increases, as it draws the ire of the government and the public. Nevertheless, an associate firm of 3 Axis Advisors found that drugmakers raised the prices of 1,400 different drugs in 2022. Pharmaceutical companies now usually try to introduce new drugs at a high price, so further price increases won’t be needed.

“Drug makers have to take a harder look at calibrating those launch prices out of the gate … so they don’t box themselves into the point where in the future, they can’t price increase their way back into profitability,” President Antonio Ciaccia of 3 Axis Advisors told Reuters.

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The price rises in January aren’t expected to be dramatic, with none of them going above 10%. However, the prices of many drugs being increased are already at astronomical levels — Bristol Myers Squibb’s cell therapies Abecma and Breyanzi, which treat blood cancer, are due for a 9% increase despite already costing more than $400,000.

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