FACT-CHECK: BRAND DRUGMAKERS' RELENTLESS PRICE HIKES CAUSE HIGHER PREMIUMS

The following information was released by the America's Health Insurance Plans (AHIP):

by AHIP

Facing intensifying bipartisan pressure to justify their blank check to keep overcharging Americans, brand drugmakers are pushing unsound polling to try and convince journalists, policymakers and the public that "reducing premiums" and "lowering prescription drug prices" are somehow unrelated to one another.

Asking Americans to choose between lower prescription drug prices and lower premiums is a false choiceand everyone knows it.

Premium growth is driven by the high and rising costs of medical care. This includes the ever-higher prices brand drugmakers charge Americans far more than what these multinational corporations charge consumers in any other country. You can't lower premiums without lowering these costs.

A new analysis by Yale's Health Care Affordability Lab published by JAMA Health Forum provided the latest reminder of this fact. Their research found that higher healthcare spending accounted for 91 percent of the growth in average premiums between 2011 and 2024. As one seasoned healthcare reporter pointed out: "In other words, it's not the insurers driving the higher health spending."

Drugmakers alone set and repeatedly raise their unaffordable prices while inducing demand for the highest-cost brand drugs through lavish tax-deductible DTC ad campaigns and abusing America's patent system to block lower-cost alternatives.

By The Numbers:

Prescription drugs already consume more than 24 cents of every premium dollar in the commercial market more than any other individual category.

Americans paid a staggering $915 billion for prescription drugs last year, and 2026 drug spending is projected to approach $1 trillion.

This year alone, drugmakers have raised the prices they charge Americans for 1,284 brand name drugs. The typical price increase outpaced broader inflation, with some weeks seeing median price hikes as high as six percent.

While brand drugmakers claim their high U.S. prices fund innovation, their own financial reports demonstrate that record-high prices and spending by Americans translates into average annual profit margins of 23.2%, an outlier in healthcare.

The same brand drugmakers charge much lower prices in other countries, forcing Americans to pay the world's highest prices for prescription drugs.

Brand drugmakers pair millions in direct payments to physicians with billions in tax-deductible advertising to boost prescribing of their costliest products, while using patent thickets to block lower-priced generic and biosimilar competition.

Brand drugmakers' well-documented patent abuse is raising Americans' healthcare costs by billions of dollars each year.

What AHIP Is Saying:

"If multinational drug companies actually cared about healthcare affordability, they would stop taking record profits by charging Americans far more than patients in any other country, stop lobbying relentlessly for a blank check to keep overcharging Americans, and simply lower their prices." Chris Bond, AHIP spokesman

Health plans are the only part of the healthcare system with an incentive to make coverage and care as affordable as possible. Health plans are working to shield Americans from the full impact of high and rising medical costs, but common-sense policy solutions are needed to bring prices down and make coverage and care more affordable.