The pharmaceutical industry’s annual tradition of raising drug prices at the start of the new year continues, but with a notable change: the size of the increases is shrinking. While more drugs are seeing price bumps in 2025 compared to 2024, the median increase has dropped significantly over the past decade.
Notable Price Increases
Despite this trend, some drugs are still seeing substantial price hikes. Pfizer’s COVID-19 drug Paxlovid will cost 3% more, while Bristol Myers Squibb’s cancer cell therapies Abecma and Breyanzi are increasing by 6% and 9%, respectively. Other drugs, like migraine treatment Nurtec and cancer drugs Adcetris, Ibrance, and Xeljanz, will see their list prices go up between 3% and 5%.
Some Companies Buck the Trend
Not all companies are raising prices, however. Merck & Co., for example, is actually decreasing the list prices of its diabetes drugs Januvia and Janumet.
The Biggest Price Hikes
The most significant price increases of the year belong to Leadiant Pharmaceuticals, which is raising the price of its Hodgkin’s disease drug Matulane by about 15% and its Cystaran eye drops for cystinosis by 20%.
Factors Influencing Drug Prices
Several factors contribute to the complex landscape of drug pricing. The Inflation Reduction Act (IRA) of 2022, which allows Medicare to negotiate drug prices, has had some impact on curbing costs. However, the future of this legislation under the new Trump administration remains uncertain.
Concerns About Unsupported Price Increases
The Institute for Clinical and Economic Review (ICER) recently released a report highlighting what it calls “unsupported” drug price increases in 2023. ICER claims that some companies raised prices despite lacking sufficient evidence to justify the increases, adding millions of dollars to healthcare costs.
Key Takeaways
- Drug price increases continue in 2025, but the median increase is smaller than in previous years.
- Some companies are choosing to decrease prices, while others are implementing significant hikes.
- The Inflation Reduction Act and scrutiny from watchdog groups like ICER are playing a role in the drug pricing landscape.
- The future of drug pricing under the new administration and the ongoing debate about affordability remain to be seen.
Source: Fierce Pharma
