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For the first time since California began requiring drug makers to report and explain their price hikes, the state released data showing the three-year median increase in wholesale prices for more than 1,000 medicines was nearly 26%, suggesting a compounded annual increase of roughly 8% from 2017 through the first quarter of this year. The annual inflation rate was 2% during the same period.

The report marks a milestone, of sorts, in efforts to force the pharmaceutical industry to provide more insight into its pricing decisions. By passing so-called transparency laws, a growing number of states hope to pull back the curtain on the link between expenses and prices that drug companies have often used to justify rising or high prices.


California was not the first state to embrace the concept, but its law went further in demanding justification for price hikes that, going forward, will be compared on a quarterly basis. Moreover, California is often seen as a bellwether state that spurs lawmakers elsewhere to follow in its path, a concern that prompted the pharmaceutical industry trade group to file a lawsuit to overturn the law.

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  • This is a completely meaningless report about list prices. California is leading the way … in irrelevant disclosures.

    Actual generic transaction prices are going through a multi-year cycle of deflation. List prices are bogus.

    For brand-name drugs, these data echo the list price data published by IQVIA and by some manufacturers. However, net prices for brand-name drugs (after rebates and discounts) are growing very slowly or declining. See

    What’s more, these list price data are already available from multiple data providers. But at least the state legislators can pat themselves on the back for “doing something.” What a waste of time.

  • One might observe that we are surprised at the potential reason, but that would be …. insincere at best. Failure to file brings a fine but …
    ” One source explained that some companies failed to explain price hikes even when reasons were already known. …there are no penalties for failing to provide explanations.”

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