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Drug companies are being required to post list prices in TV ads

If pharmaceutical manufacturers are ashamed of their drug prices, then change the price, HHS Secretary Alex Azar says.

Susan Morse, Managing Editor

The Centers for Medicare and Medicaid Services has issued a final rule requiring pharmaceutical companies to post the list prices of their drugs in television ads.

The rule, which goes into effect in 60 days, applies only for drugs that cost $35 or more per month, which represents the average copayment. The 10 most commonly advertised drugs have list prices ranging from $488 to $16,938 a month, according to information released by HHS.

Drug companies are being required to post the price for a 30-day supply, along with the name of the product. Drug manufacturers can include a statement that those who have health insurance that covers drugs could be paying a different amount, Health and Human Services Secretary Alex Azar said in an announcement Wednesday morning.

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It applies only to TV ads because, out of the $5 billion annual pharma industry spend on advertising, $4 billion is for television ads, Azar said. Drug companies have to level with people about what their drugs cost, he said.

"If you're ashamed of your drug prices, change your drug prices," Azar said.

HHS and CMS received about 147 comments on the proposed rule and declined against some suggestions that pharmaceutical companies offer a link  to pricing information online in their TV ads.

That would not be acceptable, Azar said. The drug companies pay $4 billion a year for TV advertising and to point consumers to the internet would be equivalent to saying they should put ads on the internet, he said.

Enforcement is expected to come from competitors which may bring action for a deceptive trade practice. The Food and Drug Administration does not review price information in prescription drug advertisements and does not intend to do so in the future, unless the information explicitly or implicitly incorporates safety or efficacy information about the drug in the ad, HHS said.


The rule is aimed at making drug costs transparent, bringing down prices, and lowering healthcare costs.

Patients ought to know how much they will pay for a drug before going to the pharmacy counter or getting a bill in the mail, Azar said.

By making patients more aware of drug costs, the implied impact is that either drug companies will lower their prices, or that consumers will switch to a less expensive alternative.


The rule comes out of President Trump's American Patients First Blueprint to lower prescription drug prices, which was released in May 2018.


"Patients who are struggling with high drug costs are in that position because of the high list prices that drug companies set," Azar said by statement. "Making those prices more transparent is a significant step in President Trump's efforts to reform our prescription drug markets and put patients in charge of their own healthcare."

Twitter: @SusanJMorse
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