Getty Pharmaceutical companies still have increases planned for January of next year, in spite of President Donald Trump recently shaming Pfizer and others for price hikes.
- Since President Donald Trump called out Pfizer and other drugmakers for prescription drug price increases in July, the issue has largely stalled.
- Now, though, pharmaceutical companies are planning drug price hikes for January. The increases could even be larger than usual.
- You can expect to hear a lot more about the cost of drugs next year.
Drug companies raise their prices each January, as predictably as people make New Year's resolutions.
This January will be no exception - the only question is if that will provoke any meaningful policy changes.
Drugmakers have put price hikes on a low simmer since July, when President Donald Trump publicly shamed "Pfizer & others" by tweet for jacking up their prices. Pfizer agreed to postpone its increases, and other companies either didn't take price increases, or at least reduced their price-hike ambitions over the last year, according to Bernstein analyst Ronny Gal.
But all that is being left behind when the calendar turns to 2019. Pfizer, for example, plans to increase the prices of 41 drugs in January, The Wall Street Journal reports, and the strategy extends to nearly 30 drugmakers, according to Reuters, including other prominent firms like Novartis, Allergan, GlaxoSmithKline, Amgen and Biogen.
There could even be "a step up in both the number and magnitude of list price increases (as opposed to a more gradual returning to business as usual)," Bernstein's Gal predicted. "However, while individual companies may do well, the price increases taken together would suggest Pharma is 'tone deaf' to public concerns."
Gal noted that drugmakers are once again boosting their prices just as Congress is setting its agenda. The high cost of prescriptions has drawn the ire of both Democrats, who will control the House of Representatives, and Republicans, who are expanding their majority in the Senate.
Other experts, meanwhile, are predicting that's exactly why price increases of a smaller-than-usual magnitude should be exhibited in January.
After Trump's tweet, "that freeze is starting to thaw," Pratap Khedkar, managing principal of consulting firm ZS Associates, told Business Insider, "but it's muted."
"Drug companies are facing greater scrutiny than ever on list price increases, and we expect list price increases to moderate somewhat," compared with those made in 2018, Morgan Stanley analyst David Risinger agreed.
No matter what, expect to hear a lot about the high cost of drugs again next year.
"We believe that the noise over drug pricing in 2019 - 2020 will be unrelenting," Veda Partners analyst Spencer Perlman wrote last month.
"There likely will be news every single day due to a multitude of high-profile congressional hearings, legislation introduced, presidential shaming, and regulations proposed as both parties try to one-up the other in demonizing pharma and threatening heavy-handed government actions to drive down pharmaceutical prices."
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