Prescription Drug Costs Driven By Manufacturer Price Hikes, Not Innovation

The skyrocketing cost of many prescription drugs in the U.S. can be blamed primarily on price increases, not expensive new therapies or improvements in existing medications as drug companies frequently claim, a new study shows.

The report, published Monday in the journal Health Affairs, found that the cost of brand-name oral prescription drugs rose more than 9 percent a year from 2008 and 2016, while the annual cost of injectable drugs rose more than 15 percent.

"The main takeaway of our study should be that increases in prices of brand-name drugs were largely driven by year-over-year price increases of drugs that were already in the market," says Immaculata Hernandez, an assistant professor of pharmacy at the University of Pittsburgh, and the lead author of the study.