Magazine article Risk Management

From Ponce De Leon to Prescription Medications

Magazine article Risk Management

From Ponce De Leon to Prescription Medications

Article excerpt

Ponce de Leon, one of America's earliest European explorers, arrived in what is now Florida in 1513, searching for the fountain of youth. Much to the dismay of Florida's present elderly constituency, Ponce de Leon never found this mythical oasis. A recent report indicates how welcome it would be if he had had more luck.

Families USA released a study in June 2001 revealing that prices for medications senior citizens rely on most increased at more than double the rate of inflation last year. While seniors make up only 13 percent of the nation's population, they consume 34 percent of all prescriptions dispensed and pay 42 percent of the nation's bill for prescription drugs.

According to the report, the prices of the top 50 drugs used by seniors rose 6.1 percent over a 12-month period ending in January 2001. The inflation rate during that time period, however, (excluding the cost of energy) was 2.7 percent. (On a larger time scale, between January 1996 and January 2001, the price of prescription drugs most frequently used by seniors rose 22.2 percent on average. That increase is nearly twice the 12.4 percent rate of inflation for that same time period.) More than one-third of the medications prices rose three or more times, the rate of inflation.

Of course, the type of drug makes a distinct difference in cost growth. "Of the fifty drugs used most frequently, ten are generic drugs, while the remaining forty are brand name," the report states. "Price increases among generic drugs most frequently used by seniors are, [on average], growing slower than the rate of inflation."

The greatest price increases include: Knoll's synthetic thyroid agent Synthroid, which rose 22.6 percent; Allergen's glaucoma drug Alphagen, which rose 22.5 percent; Bristol-Meyers Squibb's diabetes medication Glucophage, increasing 15.5 percent; and Wyeth-Ayerst's estrogen replacement drug Premarin, which rose 12.8 percent. Nine other drugs had price increases of three or more times the rate of inflation, including drugs that lower cholesterol, combat osteoporosis and treat overactive bladders.

What does this all mean? By examining three diseases treated by some of the above-mentioned drugs, the high costs of prescriptions can be understood in a more tangible sense. …

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