Chintan V. Dave, PharmD; Aaron S. Kesselheim, MD, JD, MPH; Erin R. Fox, PharmD; Peihua Qiu, PhD; Abraham Hartzema, PharmD, MSPH, PhD
Preliminary results were presented at the 31st Annual Meeting of the International Conference on Pharmacoepidemiology and Therapeutic Risk Management, Boston, Massachusetts, 22–26 August 2015.
Acknowledgment: The authors acknowledge Ariel Stern, PhD (Assistant Professor, Harvard Business School); Michael Fischer, MD, MS (Associate Professor, Harvard Medical School); and Eric Rosenberg, MD, MSPH (Associate Professor, University of Florida College of Medicine), for their constructive comments. There was no financial compensation.
Financial Support: Dr. Kesselheim's work is funded by the Laura and John Arnold Foundation, with additional support provided by the Engelberg Foundation and the Harvard Program in Therapeutic Science.
Disclosures: Dr. Kesselheim reports grants from the Harvard Program in Therapeutic Science, U.S. Food and Drug Administration, Laura and John Arnold Foundation, and Engelberg Foundation outside the submitted work. Dr. Fox reports support from Vizient, Oklahoma Society of Health System Pharmacists, Premier Oncology Hematology Management Society, and Abu Dhabi Health Services Company (SEHA)–United Arab Emirates, and honoraria from Roseman University, outside the submitted work. Authors not named here have disclosed no conflicts of interest. Disclosures can also be viewed at www.acponline.org/authors/icmje/ConflictOfInterestForms.do?msNum=M16-1432.
Editors' Disclosures: Christine Laine, MD, MPH, Editor in Chief, reports that she has no financial relationships or interests to disclose. Darren B. Taichman, MD, PhD, Executive Deputy Editor, reports that he has no financial relationships or interests to disclose. Cynthia D. Mulrow, MD, MSc, Senior Deputy Editor, reports that she has no relationships or interests to disclose. Deborah Cotton, MD, MPH, Deputy Editor, reports that she has no financial relationships or interest to disclose. Jaya K. Rao, MD, MHS, Deputy Editor, reports that she has stock holdings/options in Eli Lilly and Pfizer. Sankey V. Williams, MD, Deputy Editor, reports that he has no financial relationships or interests to disclose. Catharine B. Stack, PhD, MS, Deputy Editor for Statistics, reports that she has stock holdings in Pfizer and Johnson & Johnson.
Reproducible Research Statement:Study protocol and statistical code: Not available. Data set: Analytic data set is available from Dr. Dave (e-mail, firstname.lastname@example.org).
Requests for Single Reprints: Chintan V. Dave, PharmD, 1225 Center Drive HPNP 3226, Gainesville, FL 32611; e-mail, email@example.com.
Current Author Addresses: Dr. Dave: 1225 Center Drive HPNP 3226, Gainesville, FL 32611.
Dr. Kesselheim: 1620 Tremont Street, Suite 3030, Boston, MA 02120.
Dr. Fox: 50 North Medical Drive, Room A050, Salt Lake City, UT 84132.
Dr. Qiu: 2004 Mowry Road, PO Box 117450, Gainesville, FL 32611.
Dr. Hartzema: 1225 Center Drive, HPNP 4304, Gainesville, FL 32611.
Author Contributions: Conception and design: C.V. Dave, A.S. Kesselheim.
Analysis and interpretation of the data: C.V. Dave, A.S. Kesselheim, E.R. Fox, P. Qiu, A. Hartzema.
Drafting of the article: C.V. Dave, A.S. Kesselheim, E.R. Fox.
Critical revision for important intellectual content: C.V. Dave, A.S. Kesselheim, E.R. Fox, P. Qiu, A. Hartzema.
Final approval of the article: C.V. Dave, A.S. Kesselheim, E.R. Fox, P. Qiu, A. Hartzema.
Provision of study materials or patients: A. Hartzema.
Statistical expertise: C.V. Dave, P. Qiu.
Administrative, technical, or logistic support: A. Hartzema.
Collection and assembly of data: C.V. Dave, E.R. Fox.
Prices for some generic drugs have increased in recent years, adversely affecting patients who rely on them.
To determine the association between market competition levels and the change in generic drug prices in the United States.
Retrospective cohort study.
Prescription claims from commercial health plans between 2008 and 2013.
The 5.5 years of data were divided into 11 study periods of 6 months each. The Herfindahl–Hirschman Index (HHI)—calculated by summing the squares of individual manufacturers' market shares, with higher values indicating a less competitive market—and average drug prices were estimated for the generic drugs in each period. The HHI value estimated in the baseline period (first half of 2008) was modeled as a fixed covariate. Models estimated price changes over time by level of competition, adjusting for drug shortages, market size, and dosage forms.
From 1.08 billion prescription claims, a cohort of 1120 generic drugs was identified. After adjustment, drugs with quadropoly (HHI value of 2500, indicating relatively high levels of competition), duopoly (HHI value of 5000), near-monopoly (HHI value of 8000), and monopoly (HHI value of 10 000) levels of baseline competition were associated with price changes of −31.7% (95% CI, −34.4% to −28.9%), −11.8% (CI, −18.6% to −4.4%), 20.1% (CI, 5.5% to 36.6%), and 47.4% (CI, 25.4% to 73.2%), respectively, over the study period.
Study findings may not be generalizable to drugs that became generic after 2008.
Market competition levels were associated with a change in generic drug prices. Such measurements may be helpful in identifying older prescription drugs at higher risk for price change in the future.
Chintan V. Dave, Aaron S. Kesselheim, Erin R. Fox, Peihua Qiu, Abraham Hartzema. High Generic Drug Prices and Market Competition: A Retrospective Cohort Study. Ann Intern Med. 2017;167:145–151. doi: 10.7326/M16-1432
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Published: Ann Intern Med. 2017;167(3):145-151.
Published at www.annals.org on 4 July 2017
Healthcare Delivery and Policy, High Value Care, Hospital Medicine.
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