Drugmakers – Pfizer, Sanofi, Takeda, more – will raise 500 drug prices in January

The new year is beginning as the old one ended, with an ongoing debate over the high cost of prescription drugs. The prices of numerous pharmaceuticals are going up this month, even as the Biden administration pursues multiple initiatives to hold down costs.

While last January, prices went up on 1,425 drugs, manufacturers Pfizer, Sanofi, Takeda Pharmaceuticals and others plan to raise U.S. prices on more than 500 drugs in early January, according to health care research firm 3 Axis Advisors. This includes more than 140 drug brands, as well as various doses and formulations of those brands. Pfizer announced the largest number of price hikes, increasing prices on 124 drugs and an additional increase on 22 drugs under its Hospira arm. Takeda-owned Baxalta announced 53 price hikes and UCB Pharma will raise prices on 40 drugs. Sanofi, which pledged to cut 2024 insulin prices earlier this year, will increase the prices of its vaccines against typhoid fever, rabies and yellow fever by 9% each in January.

These increases are for list prices, which do not include rebates to pharmacy benefit managers or other discounts. The hikes come as the industry prepares for reduced prices for 10 expensive drugs while facing inflation and higher manufacturing costs. Concern also is growing about potential disruptions to supply chains because of the conflict in the Middle East.

Despite the overall trend of increasing prices, however, drugmakers raised prices on 1,425 drugs in 2023, down from 1,460 in 2022. Three companies are expected to lower prices on at least 15 drugs in January. GlaxoSmithKline recently said it would cut prices on some asthma, herpes and anti-epileptic drugs for 2024.

The cuts come after several companies already have announced price decreases for insulin to avoid penalties that could have been imposed under the 2021 American Rescue Plan Act if they had kept prices high. Under the law, drug companies are required to rebate Medicaid if price increases outpace inflation, and beginning this month, these rebates could be even larger than the actual net cost of the drug.

Related: High drug prices: Why 9 million Americans are not taking medications as prescribed

Eli Lilly planned to lower the prices of its Humalog and Humulin insulins by 75.8% and 70% respectively on December 30 and to raise the price of its popular diabetes drug Mounjaro by 4.5% on January 1. These changes were not included in the 3 Axis data. “Every major former blockbuster insulin is going to get thrown under the tires of this policy,” Axis President Antonio Ciaccia said.

Manufacturers have been limiting their price hikes to 10% or less since they were criticized in the mid-2010s. According to 46brooklyn, a nonprofit focused on drug prices, the median increase in drug prices has been around 5% since 2019.