For a consumer who’s enrolled in Medicare and takes three brand name prescription drugs on a chronic basis, the average increase in the cost of the medications used to treat those conditions increased by nearly $2,100 between 2002 and 2008.

Between 2007 and 2008, the average increase in drug price over 3 therapies was $556.

These findings, and other details describing price increases for 211 prescription drugs int he “Medicare Rx market basket,” are found in the AARP’s latest Rx Watchdog Report: Trends in Prices of Prescription Drugs Used by Medicare Beneficiaries.

AARP began the series of drug price Watchdog Reports in 2004; the timing of the founding of this report coincided with the implementation of the Medicare Part D drug benefit and concerns for seniors’ falling into the proverbial “donut hole,” the interval during which seniors would pay 100% out-of-pocket for their prescription drugs until meeting their mandated OOP max.

The AARP compared general inflation with the average price increases for the most used drugs by Medicare enrollees. In 2008, general inflation rose 3.8%; together, the average prices for the most widely used prescription drugs among Medicare beneficiaries was 8.7%. Thus, the prices of these drugs grew more than twice the rate of increase of inflation. AARP found that for 3 drug manufacturers — Boehringer-Ingelheim, Monarch and Sepracor — the average annual price increase for drugs in the market basket of 211 Rx’s was more than 3x the rate of general inflation.

Merck had the lowest average annual price increase for drugs in 2008, at 3.4% — below inflation. The AARP notes that one-half of the prescription drugs int he Medicare Rx market basket went off-patent since 2006.

According to the report, the top 10 most-prescribed drugs in the Medicare Rx market basket in 2006 were Nexium, Plavix, Prevacid, Protonix, Lipitor (20 mg and 10 mg), Aricept, Fosamax, Norvasc, and Advair.

Health Populi’s Hot Points: Since the introduction of Medicare Part D in 2007, pharmaceutical companies have raised prices of the most commonly used drugs by older Americans based on AARP’s research. With the weakened economy, consumers are looking for ways to reduce costs in their weakened household budgets and are more value-conscious consumers than ever. This is certainly a truism in health as out-of-pocket costs continue to increase for most people in the U.S. The challenges for people managing chronic conditions on fixed incomes in this current economic climate are particularly acute.

In addition to vitamin sales increasing during the economic downturn, it’s clear that some people use more over-the-counter and home treatments to avoid spending money on prescription drugs. This was shown by a Kaiser Family Foundation study published in February 2009.

One are that could help seniors (and younger people managing chronic conditions) is a faster switch from Rx to OTC expected in the next few years as patents expire and payers get more aggressive about managing Rx costs.

Kalorama Information’s report on blockbuster drug expirations points to this possibility. “As many blockbuster drugs near patent expiration, face generic competition and demand intensifies for self-medication we can expect a healthy future for Rx-to-OTC switches,” according to Melissa Elder of Kalorama. Their new report on Rx to OTC Switches 2009 identifies areas ripe for Rx-to-OTC switching including gastrointestinal (think: Pepcid), high cholesterol, osteoporosis, overactive bladder, sexual dysfunction, and contraceptives.

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