Press Release November 3, 1999	Contact: Lisa McGiffert, CU, (512) 477-4431 Consumers Union's Southwest Office Ron Pollack; Families USA, (202) 628-3030

 

AUSTIN, TEXAS - The price of a popular drug used to fight Parkinson's disease rose 385 percent over the past five years and another one to combat angina went up 111 percent. The two drugs were among 50 used extensively by older Americans whose prices far outpaced the rate of inflation during this period, according to a report released today by the consumer watchdog group Families USA and Consumers Union.

From January 1998 to January 1999, the prices of the 50 most prescribed drugs for older Americans increased 6.6 percent, four times the rate of inflation (1.6 percent), the report said. Over the past five years, the prices of these popular drugs rose twice as fast as the rate of inflation.

Meanwhile, the pharmaceutical industry continues to net record profits and outpatient prescription drugs are still excluded from Medicare coverage.

"There is something seriously wrong with this picture," said Lisa McGiffert, a senior policy analyst with the Southwest Regional Office of Consumers Union. "Seniors whose lives depend on prescription drugs are at the mercy of huge drug corporations, which are making money hand over fist at their expense."

While older Americans fill over 18 prescriptions per year, and nearly half of all Medicare beneficiaries live on less than $15,000 per year, the elderly are the last major insured consumer group without access to prescription drugs as a standard benefit.

"It is unconscionable that the sickest and oldest Americans go without prescription drug coverage as part of their basic benefit package," said Ron Pollack, executive director of Families USA. "Each year their social security checks increase only at the rate of inflation, while the costs of the drugs they take rise at two, three or four times the rate of inflation."

Among the drugs examined in the new report by Families USA, Hard To Swallow: Rising Drug Prices for America's Seniors:

· Lorazepam, used to treat Parkinson's disease, cost $97 for a year's supply in 1994, now costs $469 per year. The cost increased by 279 percent from January 1998 to January 1999 (179 times the rate of inflation) and by over 385 percent in the last five years (30 times the rate of inflation).

· Imdur, used to treat angina and the seventh most prescribed drug for seniors, increased in price ten times over the last five years, going from $237 per year in 1994 to $525 per year in 1999. It increased in cost by more than 111 percent over the last five years (almost nine times the rate of inflation).

· Lanoxin, used to treat congestive heart disease and the most prescribed drug for seniors, increased in price by over 87 percent in the last five years (almost 7 times the rate of inflation), increasing 15 percent from 1998-1999 alone (almost ten times the rate of inflation).

· Atrovent, used to treat respiratory illnesses, increased in price eight times and went from $382 per year in 1994 to $546 per year in 1999. From January 1994 to January 1999, the drug increased over 37 percent in price, almost three times the rate of inflation. In calendar year 1998 alone, the drug increased over 14 percent in price (nine times the rate of inflation).

· Propulsid, used to treat gastrointestinal problems, went from $876 per year in 1994 to $1,171 per year in 1999. From January 1994 to January 1999 the drug increased in cost almost 30 percent, over two times the rate of inflation. Propulsid increased in cost by nine percent from 1998-1999 alone, almost six times the rate of inflation.

The report found that, in the last year, among the 50 most prescribed drugs for seniors:

· forty-two of the 50 drugs increased in price faster than the rate of inflation (report tables 1 & 2);

· more than two-thirds (36 out of 50) rose two or more times faster than the rate of inflation;

· nearly half (23 out of 50) rose at more than three times the rate of inflation; and

· one-third (17 out of 50) rose at more than four times the rate of inflation.

While the median profit for all Fortune 500 companies was 4.4 percent in 1998, the manufacturers of the 50 most prescribed drugs for seniors saw their median profits soar almost five times higher (20 percent). Astra, Pfizer, Schering, Eli Lilly and Merck, which manufacture 19 of the 50 most prescribed drugs for seniors, enjoyed profits over 20 percent in 1998.

The price increase data in the report are based on price increases in average wholesale prices. Data for the report were prepared for Families USA by the PRIME Institute of the University of Minnesota. The report is available on the Families USA website, www.familiesusa.org.

Consumers Union, publisher of Consumer Reports, is an independent, nonprofit testing and information organization, serving only the consumer. We are a comprehensive source of unbiased advice about products and services, personal finance, health, nutrition, and other consumer concerns. Since 1936, our mission has been to test products, inform the public, and protect consumers.

Families USA is the national organization for health care consumers. It is non-profit and non-partisan and advocates for affordable and high-quality health and long-term care for all Americans. Families USA can be reached at 202-628-3030 or on the web at www.familiesusa.org.