Combination Brand-name Drugs More Expensive than Purchasing Separately

Two for the price of one may not apply to certain medications, a new study has found. 

Researchers analyzed the 1,500 medications that accounted for the highest total spending of Medicare Part D drugs in 2015, including 29 brand-name combination pills that have generic alternatives available. For 2016, they estimated that using the generic versions of the 29 combo drugs for the same number of doses would have saved the Medicare drug benefit program $925 million. 

Over the course of the whole study, had the top 10 most expensive combo drugs been replaced by their generic constituents, Medicare spending could have been about $2.7 billion lower. 

This study estimates that the additional cost to #Medicare when physicians prescribe brand-name combination medications instead of generic constituents was USD 925 million between 2011 and 2016. https://t.co/sasJKsaB7X

— JAMA (@JAMA_current) August 21, 2018

“These brand-name combination pills cost far more than sum of their parts,” study leader Dr. Chana Sacks told Reuters by email. 

“The price of brand-name combination drugs, like all medications in the U.S., are not determined based on the magnitude of the clinical benefit or the costs of research and development; rather prices are set by the manufacturer based on what the market will bear.” 

Researchers divided the 29 brand-name drugs with generics options available into three categories: one with generic options available in identical doses (n = 20), ones with generic constituents at different doses (n = 3), and ones with therapeutically equivalent generic substitutes (n = 6). 

JUST RELEASED: Our new data note examines the latest data and trends in the #Medicare #PartD drug benefit’s “donut hole,” the coverage gap in which enrollees must pay a greater share of their prescription drug costs. https://t.co/gR4DwNCrFO pic.twitter.com/rdBSs7SsA2

— KFF (@KFF) August 21, 2018

According to the research, 2016 Medicare spending totaled $303 million for brand-name combination drugs. If their generic versions with identical doses were prescribed instead, that cost would have been about $68 million. Also in 2016, brand-name combo pills that cost Medicare $232 would have totaled $13 million if people opted for generic versions of the drugs at different doses. For medications with therapeutically equivalent generic substitutes available, Medicare spent $491 million as opposed to $20 million had the generic versions been purchased. 

“Promoting generic substitution and therapeutic interchange through prescriber education and more rational substitution policies may offer important opportunities to achieve substantial savings in the Medicare drug benefit program,” the researchers stated. 

Read the Original Article at JAMA Here

Sources: JAMA, Reuters