It starts with something that used to be routine: disclosing the list price of a new prescription medicine. But in today’s environment, that simple action can trigger a cascade setting off a corporate crisis. 

Disclosing a therapy’s price has become a potential point of conflagration, because pharmaceutical manufacturers are soundly in the crosshairs of a public concerned about rising medical costs. Polling on the U.S. right and the left shows deep populist frustrations about mounting costs of care. The concerns are justified: healthcare spending has grown at greater than four percent for two consecutive years, outpacing the per capita growth of GDP. Last year, per-person spending on healthcare reached an all-time high of $5,564. As a result, the cost of health insurance is rising as well, and salary growth is not keeping pace with the rate of insurance premium increases. 

While the contribution of drug prices to healthcare costs has stayed relatively static in recent years, it’s one of the most routine and direct costs that patients encounter, which may be why their concerns are placed on medicine companies instead of insurers.

This content was repurposed from O'Dwyer's October 2019 Healthcare issue (see page 14).