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Be Wary of Stratospheric Increases in Generic Drug Prices

Be Wary of Stratospheric Increases in Generic Drug Prices

Generic medications are supposed to be a bargain. According to the FDA, patients may be able to save as much as 80 percent on some products.

Big box discount stores have enticed customers with a three-month supply for $10. There are certain pharmacies that have even gone so far as to give away some popular generics such as atorvastatin (Lipitor) to lower cholesterol.

The generic drug industry is changing, however, and consumer savings are slipping. In some cases, the rise in generic drug prices has been breathtaking.

Take the antibiotic doxycycline, for example. It was first approved under the brand name Vibramycin in 1967. This broad-spectrum tetracycline-type drug has been used for decades to treat a wide range of infections, from chlamydia and cholera to Lyme disease and Rocky Mountain Spotted Fever. Doctors also use it for urinary and respiratory tract infections.

Doxycycline used to be dirt cheap. One analysis from Pembroke Consulting found that the price of this antibiotic has gone from $.06 per pill to $3.65. That is an increase of over 6,000 percent in a relatively short period of time.

The same analysis found that clomipramine, a drug prescribed for obsessive-compulsive disorder, has gone up more than 3,000 percent from $0.27 per pill to $8.57.

Why have some generic drugs gone up so dramatically? Consolidation within the generic pharmaceutical industry means that fewer companies are making generic medications. Just three companies, Mylan, Teva and Actavis, generated 44 percent of generic drug revenue around the world.

Another serious problem is shortages. A number of companies have stopped making certain generic drugs. Lack of competition has led to decreased supply and increased demand, resulting in price gouging.

Several large generic drug makers have gotten into trouble with the FDA because of bad manufacturing practices. As a result, some key products from abroad have been banned, contributing to shortages and higher prices.

Pharmacies can also charge vastly different amounts for the same generic products. Consumer Reports surveyed 200 pharmacies around the country and found a wide spread in prices. Atorvastatin (Lipitor) ranged from $150 at CVS to $17 at Costco. Clopidogrel (Plavix) had a similar variation, from $15 at a discount drugstore to $180 at a large chain.

What should consumers do? It is becoming more difficult to do price comparisons online, but it is still important to shop comparatively. Call different pharmacies to get their prices. Sometimes bargaining will work, since many pharmacies are willing to match a competitor’s price.

Another place to get comparative price information is PharmacyChecker.com. This website uses international pharmacies to find the best price for both generic and brand name drugs. We also offer guidelines and tips for using generic drugs wisely in our Guide to Saving Money on Medicine. 

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About the Author
Terry Graedon, PhD, is a medical anthropologist and co-host of The People’s Pharmacy radio show, co-author of The People’s Pharmacy syndicated newspaper columns and numerous books, and co-founder of The People’s Pharmacy website. Terry taught in the Duke University School of Nursing and was an adjunct assistant professor in the Department of Anthropology. She is a Fellow of the Society of Applied Anthropology. Terry is one of the country's leading authorities on the science behind folk remedies. .
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