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Price Check On Drug Ads: Would Revealing Costs Help Patients Control Spending?

[Editor’s note: The Trump administration on May 8 finalized its rule requiring drugmakers to include price information in television ads for any products that cost $35 or more a month or spanning a typical course of therapy. The move comes amid growing federal and state interest in price transparency, although whether it will result in lower prices is uncertain. Here’s a story originally published on June 6, 2018, that explores some of the issues.]

President Donald Trump wants to control spending on drugs. One of his big ideas: include prices in advertisements, just like warnings about side effects.

That’s not as simple as it sounds.

Apart from legal questions about whether the Food and Drug Administration has the authority to require pricing in ads, other uncertainties arise.

For example, what is the right number to use?

There is a dizzying array of ways to look at drug prices, including average wholesale and average sales prices.

And dosage factors in. Would the price be pegged to a monthly cost? A per-dose cost? Or, even more inscrutable, a “unit cost,” which may not equal a single dose?

A final complication: The prices likely would not be what most consumers actually pay.

Most patients with insurance typically shell out either a flat-dollar copayment or a percentage of the drug’s cost. Some patients get coupons that can reduce their cost to zero.

An FDA working group is currently studying these issues.

Still, we wondered how drug prices pinned to ads might look, hypothetically.

We picked the top 10 most-advertised drugs by spending, courtesy of a list from Kantar Media, which advises clients on advertising and tracks spending, and showed how much each drug company spent last year on those ads. Another consulting group, Connecture, then figured the typical monthly costs, based on average wholesale prices. Those costs are based on typical dosages.

Here’s what we found:

Drug: HumiraCompany: AbbVieMonthly cost: $5,846.44Typical regimen: 40 mg every other week by injection2017 advertising: $429 millionTreats: Rheumatoid arthritis, chronic plaque psoriasis, Crohn’s disease Drug: LyricaCompany: PfizerMonthly cost: $1,070.15Typical regimen: 300 mg per day in pill form2017 advertising: $350 millionTreats: Fibromyalgia, diabetic nerve pain, spinal cord injury nerve pain and pain after shingles Drug: XeljanzCompany: PfizerMonthly cost: $4,914.77Typical regimen: 5 mg twice daily in pill form2017 advertising: $273 millionTreats: Rheumatoid arthritis, psoriatic arthritis Drug: EliquisCompany: Bristol-Myers SquibbMonthly cost: $502.84Typical regimen: 5 mg twice daily in pill form2017 advertising: $227 millionTreats: Prevention of stroke and blood clots Drug: KeytrudaCompany: MerckMonthly cost: $8,369.36Typical regimen: 200 mg every three weeks by infusion2017 advertising: $209 millionTreats: Melanoma, non-small cell lung cancer and other cancers Drug: TaltzCompany: Eli LillyMonthly cost: $6,193.92Typical regimen: 80 mg every four weeks by injection2017 advertising: $207 millionTreats: Plaque psoriasis, active psoriatic arthritis Drug: ChantixCompany: PfizerMonthly cost: $515.89Typical regimen: 1 mg twice daily in pill form2017 advertising: $207 millionTreats: Aid in smoking cessation Drug: TrulicityCompany: Eli LillyMonthly cost: $876.24Typical regimen: 0.75 mg once weekly by injection2017 advertising: $195 millionTreats: Type 2 diabetes Drug: CosentyxCompany: NovartisMonthly cost: $11,309.72Typical regimen: 300 mg every four weeks by injection2017 advertising: $174 millionTreats: Plaque psoriasis, psoriatic arthritis, ankylosing spondylitis Drug: EntrestoCompany: NovartisMonthly cost: $555.91Typical regimen: 97 mg/103 mg twice daily in pill form2017 advertising: $159 millionTreats: Chronic heart failure Sources: Kantar Media, Connecture

Graphic presentation by producer Lydia Zuraw.

KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

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