Brand-Name Medicare-D drug prices up, says AARP

American Association of Retired Person has reported a 7.4% rise in the price of the brand-name drugs which are commonly used by people enrolled in Medicare Part D, Medicare's drug plan.

AARP is a Washington-based, a nonprofit group which works for people of age 50 and older and the prices that manufacturers charge wholesalers.

In this study, the group tracked the top 220 brand-name medicines used by elderly and disabled Americans in the government's Medicare Part D drug program. The reports show a 7.4% rise in the prices which is more than a 7.1% rise reported by the AARP for 2006.

"Medicare Part D is helping millions of people afford their prescription drugs, but as brand name drug costs continue to soar more needs to be done to keep drugs affordable," said John Rother, AARP's director of public policy.

"When pharmaceutical companies raise wholesale prices, consumers are ultimately stuck with the bill," he added.

Of the 220 medicines reviewed by the AARP, prices of all except four went up in the last year. The average wholesale cost of 169 drugs rose by 50% in the period from 2002 to 2007 than what it used t be in 2001.this has added an additional $1,600 to the cost of treatment for a patient who is taking three prescriptions.

Out of the 25 most- popular drugs on the list, the sleep aid Ambien, by Sanofi-Aventis, had the largest price increase, 27.7 percent. The price of Merck's cholesterol drug Zocor did not change in 2007, and the price of Bristol-Myers Squibb's blood thinner Plavix rose 0.5%.

However the prescription drug industry holds a different opinion regarding the situation. According to them, AARP's numbers do not reflect the actual amounts that elders have to pay for their medicines.

“They do not reflect the clear downward trend in prescription drug price growth," said Ken Johnson, Senior Vice President for the Pharmaceutical Research and Manufacturers of America (PhRMA).

According to him, in 2007, the rate of growth in prescription drug prices has been slow as compared to previous years by almost 1.8 percentage points. In other words, prescription drug prices are rising, but not as quickly as in the past.

He also added that it is the government's price index for medicines which gives the authentic idea of what consumers actually buy, rather than the few selectively highlighted by AARP. This index includes a blend of brand names and generic drugs.