Prescription drug prices can vary by thousands of dollars depending on where you buy them
The price of the same prescription drug can vary by hundreds or even thousands of dollars, depending on where you buy it, according to a new report by the U.S. Public Interest Research Group which surveyed hundreds of pharmacies and found large price differences for identical medications.
Nearly one in four Americans struggle to pay for their medications and this year already, more than 250 prescription drugs have seen price hikes averaging 6 percent, according to an analysis by RX Savings Solutions.
Adam Garber is the consumer watchdog for the U.S. PIRG. The group surveyed more than 250 pharmacies across the country for the cash prices of common medications, the price someone pays if they don't have insurance or are under-insured and do not qualify for coupons or savings programs sometimes offered by drug manufacturers.
"These real price variations we're seeing have huge health consequences for Americans," Garber told CBS News' Anna Werner. "These prices are often how they determine how much insurers are going to pay for the drugs … it sort of sets the whole pricing scheme up."
The study found consumers could save anywhere from $100 to $5,400 a year just by price shopping. In Ohio, they found the same inhaler being sold for $11.99 at one pharmacy and $1,136 at a different pharmacy. In North Carolina, a generic medicine to lower cholesterol could cost $7 or $393 depending on where it was purchased.
"You expect like when you go to the bigger pharmacy you'll get a better deal, but our research found actually the smaller independent pharmacies really consistently offered cheaper options for the same medications," Garber said.
Like 30 million other Americans with diabetes, Brianna Hamilton needs insulin to stay alive. Last year, she says she paid $60 for a 90-day supply of NovoLog pens, the brand of insulin she uses. But then her insurance coverage changed this year.
"Anytime I eat anything, even with a small amount of sugar in it, I have to take insulin or my blood sugar goes really high, I could end up in a coma and I could be dead," Hamilton said. "I showed up at the pharmacy to pay for my 90-day supply and it was $1,400."
Hamilton said the two types of insulin she uses as well as supplies, like needles and testing strips, will now cost her $1,000 per month, even with a coupon from the manufacturer until she hits her new insurance plan's $3,000 deductible.
"It's one of those things where I try to do everything right financially. You know, get my degree, get a good job and I still … If I don't like cut back on a lot of stuff, I could be homeless. Or dead without my insulin and that's not fair," Hamilton said.
Stephen Schondelmeyer, a professor of pharmaceutical economics at the University of Minnesota, said, "At all levels of the marketplace from the manufacturer to the wholesaler, to the retailer, and then to the insurer and the pharmacy benefit manager, they all kind of hide the prices and don't like to make their prices transparent or known to anyone."
The National Association of Chain Drug Stores told us in a statement that cash transactions only account for eight percent of prescriptions written and "these prices vary according to many factors, including: the exact time when the drugs were purchased from the supplier; fluctuations in product supply and thus pharmacies' costs; and other factors throughout the entire supply chain."
It also says surveys like U.S. PIRG's don't take into account "widely prevalent savings programs" made available to patients who pay cash. But Schondelmeyer said big chains take advantage of their name recognition and "charge higher prices typically than your medications would cost at the local independent pharmacy."
Brianna Hamilton said her family will cut back more and possibly move until her deductible kicks in.
In response to growing concerns, Eli Lilly announced on Monday it will start selling a cheaper, generic insulin. Novo Nordisk, the company that makes the brand of insulin Hamilton uses, told CBS News they "want to find additional solutions that address access and affordability" of their medications.
Some tips for getting the best price on your medications include calling multiple pharmacies, both large and small, to compare costs and asking for prices with insurance as well as cash prices. It's also important to consult with your doctor about generic options and check out websites that do cost comparisons with drugs.
In a statement to CBS News, B. Douglas Hoey, the CEO of the National Community Pharmacists Association, said, "We really can't speculate why certain large chains are significantly more expensive, but community pharmacies answer to citizens on Main Street, not shareholders on Wall Street."
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