One of the world’s largest drug companies has been aggressively raising prices even as it received hundreds of millions of dollars of U.S. government aid to develop a COVID-19 vaccine.
AstraZeneca, which the Trump administration has celebrated for its vaccine work, boosted prices despite renewed promises by President Donald Trump this summer to keep drug costs in check.
The multinational pharmaceutical firm raised prices in a way that stood out even among other big drug companies. It announced not just one set of price hikes in 2020 but two, often on the same drugs, according to an analysis of drug-pricing data by the Los Angeles Times and 46brooklyn Research, a nonprofit that studies the pharmaceutical industry.
AstraZeneca hiked prices on some of its biggest-selling medicines by as much as 6% this year at a time when the overall inflation rate is hovering around 1%, the analysis showed. The administration has said nothing about the price increases.
AstraZeneca’s second round of increases came after it secured a $1.2-billion commitment in May from the U.S. for vaccine development and as the company was reporting more than $3.6 billion in operating profits in the first half of 2020.
“They clearly made a decision to do their pricing differently, both from their recent past and from their peers, at the same time they were seeking billions of dollars,” said 46brooklyn’s Eric Pachman.
AstraZeneca, which is based in Britain but also has a large U.S. operation, declined to discuss its pricing practices, instead offering a statement noting the company’s assistance programs for people unable to afford its drugs.
“We recognize the challenges many Americans are facing and remain committed to ensuring patients are able to access our medicines,” the statement said.
The company’s price hikes underscored the persistent inability of American policymakers, including Trump, to rein in drug prices, even during a public health crisis when pharmaceutical companies are receiving substantial public assistance.
“Pharma corporations are sophisticated political actors that understand this is a risky time to be seen increasing prices, and yet these corporations are addicted to price increases,” said Peter Maybarduk, who oversees drug policy for the nonprofit watchdog group Public Citizen.
Although the federal government has committed more than $10 billion this year to drug companies to develop a COVID-19 vaccine, the administration hasn’t required any commitments from drugmakers on the price they would charge.
Thus far, companies receiving government aid have only made vague promises to make any vaccines they develop affordable.
AstraZeneca has said it wouldn’t profit from vaccine sales during the pandemic, but it remains unclear how this would be verified and whether the company might raise prices after the worst of the crisis passes.
Drugmakers for years have pledged to make their products more affordable, assuring U.S. lawmakers, patient groups and others that they are sensitive to the struggles many Americans have paying for their medications.
Yet patients in the U.S. are finding it increasingly difficult to afford prescriptions, with 1 in 5 households reporting last year they were unable to pay for a medicine that a doctor had prescribed in the previous year because of costs.
Nevertheless, to start this year, most major pharmaceutical companies continued to hike prices at rates far exceeding inflation, the Times and The c46brooklyn found.
Several of the world’s biggest drugmakers announced hikes of 5%, 6%, even 9% on a host of popular medicines, according to the analysis, which looked at list prices by the 15 largest drug companies using the Elsevier Gold Standard Drug Database, which includes pricing and clinical information on tens of thousands of medications.
List prices are typically higher than the final prices health insurers and governments negotiate with drugmakers.