A frigid February of drug pricing changes
As a non-profit, we at 46brooklyn have made it our goal to provide insights into U.S. drug pricing data available in the public domain based upon the figures we’ve gathered over the prior month. This month is of course no different – reviewing the latest drug pricing changes from February 2025.
The Cliff Notes from last month’s drug price changes
There were a net 37 brand drug list price increases in February, meaning there were 40 products that increased wholesale acquisition cost (WAC) prices whereas three declined. Price changes ranged from a 88.7% WAC price decrease to a 150% WAC price increase. If that seems a little all over the place, it is (based on typical monthly change activity); however, the average list price change in February is more or less in line with what we’ve seen in prior years and months (2024 excluded).
Some of the biggest and/or most interesting movers to take note of for February 2025 were:
Acetadote (acetylcysteine) saw an 88.7% WAC decrease, impacting approximately $9K in gross prior year Medicaid expenditures (PYME).
Increlex (mecasermin) saw a WAC list price increase 150%, impacting approximately $3.8 million in PYME. Notably, this is the largest increase thus far in 2025 and is occurring after the medication was sold from Ipsen to Eton pharmaceuticals.
Sublocade (buprenorphine extended-release) took a 5% WAC list price increase, impacting approximately $532 million in PYME (a PYME impact 10-fold higher than the next closest medication in February).
Bear in mind that as you read those numbers, that they are the prices before drugmaker rebates, which as we know are growing significantly over time and are at their largest amounts in the Medicaid and 340B programs.
On the generic side of the coin, year-over-year (YoY) generic oral solid price deflation is at 13.4% (per National Average Drug Acquisition Cost, or NADAC). We expect lower month-over-month trends for generic drugs than we are used to, given the December 2024 changes to generic NADAC reporting (discussed here; namely, using three-month averages to determine NADAC prices). We’ve been harping on the change for a few months now, but this month, we note that some of the drugs don’t seem to be following the math precisely – namely, Carbidopa-Levodopa-Entacapone Tabs and M-Dryl. While these drugs are not necessarily demonstrative of the overall month, they do speak to the importance of understanding the methods behind NADAC calculation in order to properly contextualize the observations we make regarding generic drug costs.
If you’re only looking for the high-level overview, then hopefully the above meets your needs. If you want more of the details, read on.
What we saw from brand-name medications in February
1. A small number of brand drug list price changes, in-line with most February-ies
There were a total of 40 brand-name medications that saw wholesale acquisition cost (WAC) price increases in February and three that took decreases (so 37 net increases), which is featured and contextualized in our Brand Drug List Price Change Box Score, which pulls WAC pricing data from Elsevier.
Price changes this month ranged from -88.7% to +150%.
As a reminder, brand drug list price increases in Medicaid are largely held in check thanks to the Medicaid Drug Rebate Program (MDRP), which includes rebate penalties for drug price increases that occur faster then the rate of inflation. Medicare now has similar cost containment provisions. Commercial employers and cash-paying patients may lack legislated protections from price increases – especially those that occur faster than the rate of inflation.
This is one of a number of reasons that solely analyzing brand list price changes provides an incomplete picture of what’s really happening with brand manufacturer economics, thanks to the growing lot of opaque rebates, discounts, and giveaways that drugmakers shave off those list prices. But alas, until drugmakers, PBMs, insurers, wholesalers, 340B covered entities, and rebate aggregators make more granular data on net prices public, we’ll continue working with what we’ve got.
2. Brand price trends over time
To help contextualize brand name drug list price increase behavior, we find it beneficial to review past trends. In comparison to the data from prior months of February, this year’s net (combined increases and decreases) price changes seem to line up more with 2024 than 2023. In February 2024, there were a net 35 brand price increases, and in February 2023, there were a net of 54 brand price increases. In February 2025, there were a net of 37 brand price increases.
The highest number of net February price increases occurred in 2017 (at 67 net price increases). In addition to being the shortest month of the year, February is nearly always a month with very little brand-name list price changes. For example, in comparison to January 2025, February constitutes just 3.7% of all list price changes thus far in 2025 (we’re right at 1,000 net list price increases through February 2025).
Figure 1
Source: Elsevier Gold Standard Drug Database, CMS State Drug Utilization Data, 46brooklyn Research
Of course, we should note that it used to be more common to take price increases twice per year, so in some instances, comparisons to the past misses some of the context needed to fully appreciate the realities of today versus those of the past.
When we look at the level of price increase changes that are occurring, we see a continued return to “normal” course of business (if there is a normal to the way US drug pricing works). As we wrote about last year, 2024 was interesting when attempting to contextualize drug prices, as some pretty significantly used brands (e.g., insulins and inhalers) took sizable price decreases, which made our weighted view of brand list price changes go a little wacky. Well, at the start of this year, while there are still some decreases (three for February 2025, as previously identified), those drugs that are declining are not as significantly utilized as others, and the brand list price changes that are occurring look very similar to past years. The average list price change is approximately 4% (depending upon which way we try to contextualize price – see Stat Boxes 3 & 4 on in the dashboard; displayed here in Figure 1). Said differently, this early 2025 behavior (now through February) is much more like what 2023 was than what 2024 observations were.
3. Brand drug list price changes worth taking note of in February
We identify drugs worth taking note of in a couple different ways. Primarily, we look for medications with a lot of prior Medicaid expenditures (not that Medicaid is the end-all-be-all, but it is the only program that regularly publishes past utilization with some decent granularity). We next look for drugs with large pricing changes (+/- 10%). And finally, we look for drugs that are interesting for us either because we’ve previously written on them or because we find them of unique clinical value. With that in mind, here are our call-outs:
Acetadote (acetylcysteine) injection is a medication used to treat acetaminophen overdose or reduce liver injury after exposure to certain types of toxins. This medication took the biggest decrease in February, declining in price by 88.7%. However, this is a medication that has generic alternatives now; so this decrease only impacts approximately $9K in prior year Medicaid expenditures (PYME).
Increlex (mecasermin) is a medication used to help treat growth delay in children who lack insulin-like growth factor-1 (IGF-1) . Interestingly, Ipsen, the historic manufacturer of this medication, sold Increlex to Eton Pharmaceuticals in a deal that closed in Q4 2024. Eton Pharmaceuticals has announced that it has relaunched Increlex with a new salesforce and sales picking up. We’re highlighting this drug this month because it took the largest increase of the month, with its WAC price increase of 150% (from approximately $6K per 4 mL vial to $14.7K). This drug was associated with $3.8 million in PYME – though given the list price increase far outpaces the rate of inflation historically – and this is a medication used pretty significantly in kids (which Medicaid tends to cover a lot, like approximately 40% of all kids in the US), the net price for Medicaid will likely decline due to the Medicaid Drug Rebate Program and the inflationary rebate penalty in that program (if you look at the dashboard, Increlex has taken a list price increase every year we have summarized, so this latest increase appears to really outpaces the rate of inflation, which guides the inflationary rebate penalties).
Sublocade (buprenorphine extended-release) is an injection used to treat opioid use disorder. This medication took a 5% WAC price increase, impacting approximately $532 million in PYME. We highlight it because it has the most PYME impact of any of February’s price increases (over 10-fold higher than the next closest medication, Fanapt).
What we saw from generic medications in February
4. A relatively favorable, unweighted price change picture
Each month, we look at how many generic drugs went up and down in the latest month’s survey of retail pharmacy acquisition costs (based on National Average Drug Acquisition Cost, NADAC), and compare that to the prior month (Figure 2).
Basically, the quick way to read Figure 2 is to look for orange bars that are taller than blue bars to the left of the blue line, and exactly the opposite to the right of the line. That would indicate a good month – more generic drugs going down in price compared to the prior month, and less drug prices going up.
Figure 2
Source: Data.Medicaid.gov, 46brooklyn Research
In looking at the above, for every generic drug that decreased in price this past month, 4.7 increased in price – a largely unfavorable view of generic drug price changes. But as usual, take this unweighted price change analysis with a grain of salt. To really make heads or tails of all of these pricing changes, let’s weight these changes.
5. Weighted Medicaid generic drug costs come in at $135 million inflation
The purpose of our NADAC Change Packed Bubble Chart (Figure 3) is to apply utilization (drug mix) to each month’s NADAC price changes to better assess the impact. We use Medicaid’s 2020 drug mix from CMS to arrive at an estimate of the total dollar impact of the latest NADAC pricing update. This helps quantify what should be the real effect of those price changes from a payer’s perspective (in our case, Medicaid; individual results will vary).
The green bubbles on the right of the Bubble Chart viz (screenshot below in Figure 3) are the generic drugs that experienced a price decline (i.e. got cheaper) in the latest survey, while the yellow/orange/red bubbles on the left are those drugs that experienced a price increase. The size of each bubble represents the dollar impact of the drug on state Medicaid programs, based on utilization of the drugs in the most recent trailing 12-month period (i.e. bigger bubbles represent more spending). Stated differently, we simply multiply the latest survey price changes by aggregate drug utilization in Medicaid over the past full year, add up all the bubbles, and get the total inflation/deflation impact of the survey changes.
Figure 3
Source: Data.Medicaid.gov, 46brooklyn Research
Overall, in February, there was $152.7 million worth of inflationary drugs, with an offset of just under $17 million of deflationary generic drugs, netting out to approximately $135.8 million of generic drug cost inflation for Medicaid. This is the most inflation we have had in this measure since December 2024 (a couple months ago). We note that the December 2024 inflation occurred at the same time that CMS changed its methods for NADAC calculation to include “smoothing.” As we’ve previously noted in regard to smoothing, one of the things that continues to stand out to us in looking at Figure 3 is the monochrome colors of either the deflation or inflation side of the coin. We’re potentially seeing the effect of that smoothing in Figure 3, as there is really only pale yellow on the inflation side (no oranges or reds) and only pea-soup green on the deflation side (a few forest and darker greens, but not many). In other words, the swing towards inflation is not necessarily because a few meaningful drugs saw big price increases, but rather that a bunch of drugs saw a little bit of price increases.
However, one reader of 46brooklyn recently pointed out that the smoothing may not be going exactly as planned. We received a message inquiring about the February NADAC price point for Carbidopa-Levodopa-Entacapone Tabs. Because CMS relies upon a three-month average to calculate the NADAC price for generic drugs from December 2024 forward, it is possible to use the prior months to derive what the December 2024 price would have otherwise been but for the smoothing. The math for this is as follows:
Now, re-arranging this formula for the reported December 2024 price (the one published using the three-month average), we can derive what the December 2024 price would have otherwise been using the following math:
We can roll this math forward to get the January 2025 & February 2025 price that would have otherwise been published but for the three-month moving average. However, when we do this, the math for Carbidopa-Levodopa-Entacapone Tabs doesn’t make sense, as the derived February 2025 price is actually a negative money – meaning that in order for the published February 2025 price to make sense, pharmacies would have had to have been paid by wholesalers to acquire the drug (which obviously wouldn’t happen). Here is the math for the NDCs for Carbidopa-Levodopa-Entacapone Tabs in Figure 4 (in yellow are our derived amounts using the type of math outlined above):
Figure 4
Source: Data.Medicaid.gov, 46brooklyn Research
As you can see from the above, the February price that would have had to be observed to make the published price make sense given the prior months would have been a negative number (i.e., pharmacy got paid, rather than paying for, the drug). Having this observation given to us in our inbox, we then went back to the point when the three-month moving average was implemented and looked at all the derived pricing to see if any other drugs were negative. We only found one – also negative in February 2025 – which was M-dryl (a generic, liquid diphenhydramine product):
Figure 5
Source: Data.Medicaid.gov, 46brooklyn Research
Ultimately, these observations do not make sense based upon a simple average and derivation approach to NADAC. We can only speculate that the above observations are explained by one or none of the following:
Data from older months (i.e., before February 2025) were more recently received (i.e., in February 2025): In looking at the NADAC methodology, we do not see any requirement that the data for consideration be confined to the month the survey. The methodology simply says that data must be from the most recent 12 months under review. If this is the case, then our assumptions about the ability to derive NADAC amounts would be wrong (i.e., the average of February would not be able to be derived based upon the derived January and December amounts). There is at least some support for this idea in that groups like Mark Cuban Cost Plus Drug Company has had Carbidopa-Levodopa-Entacapone Tabs available for $0.54 per unit for awhile now.
Changes occurred in the basket of goods / weighting of observations from one month to the next: In looking at the NADAC methodology, generic drugs are given a single price based upon observations across a range of NDCs. It is possible that something changed within the observations at the equivalent NDC-level that would mess with the math in such a way to validate the observation for February.
An error was made in these drugs
To be clear, it is possible that none of the above explain what is going on here. We note it here in the hopes that maybe someone reading knows the answer and will let us know, as we were not able to give a satisfactory answer to the person who brought this to our attention initially. Until such time as we know, we will continue to monitor for these and report on any observations here.
We also note that according to groups who monitor CPI (Hi Eric, we miss you), prescription drug prices have been increasing in 2025 (particularly relative to 2024). While we don’t generally monitor CPI for prescription drugs, it is a noteworthy observation and helps transition us to our next section: what is going on with generic drugs on a year-over-year basis.
6. Year-over-year generic oral solid deflation at 13.4%
Ever since June 2020, we have been tracking year-over-year generic deflation for all generic drugs that have a NADAC price. We once again weight all price changes using Medicaid’s drug utilization data. This month, deflation on oral solid generics and all generics was at 13.4% and 11.2%, respectively (Figure 6). If you are a purchaser of generic drugs, an increase in this metric is ideal, as it means costs are declining. This is right in line with the NADAC Change Packed Bubble Chart, which also showed the cost of generic drugs decreasing. Businesses generally enjoy it when their input costs go down.
Figure 6
Source: Data.Medicaid.gov, 46brooklyn Research
At the risk of sounding like a broken record, we anticipate the continued flattening of the YoY generic deflation trend. If the “best” generic deflation that can occur for a drug is a 33% monthly decrease, it would take an overwhelming amount of those types of drugs on any given month to get to 20% or more monthly deflation. In other words, we suspect (in a semi-educated way) monthly oral generics will probably be around the average in any given month (as the idea of smoothing is to reduce extremes, so any decline would occur gradually – which is to say not too far off the average).
7. Top/notable generic drug price changes this month
While we normally spend the final part of our monthly report highlighting specific generic drug price changes (similar to what we do with brands), we have already done that to an extent in our review of NADAC smoothing. We feel it important to note, as we haven’t yet, that the impact of smoothing is to say, in effect, prices will never decrease by more than 33% month-over-month, although they could potentially increase to a reasonably high, uncapped degree. Given the formulas we’ve reviewed for three-month average, this would be plain. If we plug in $0 as the lowest value – basically getting the drug for free for a month, which isn’t really possible – the most we can reduce the price month-over-month would be by 33% of the previously published price. We can actually see this if we review the monthly NADAC Price Change Histogram images (this month’s histogram is Figure 2). As can be seen in the gallery below, whereas we used to get some drugs that decreased or increased by 40% or 50% month-over-month, we don’t see those kinds of behaviors anymore (and are not likely to see them so long as the smoothing remains in the NADAC methods). In some ways, we interpret this to mean that it will be easier for prices to increase rather than decrease, which is something we all may want to have in the back of our mind as we review prices going forward.
While we believe that NADAC remains a superior drug pricing benchmark relative to others that are pervasively used in pharmacy benefit manager (PBM) contracts with plans sponsors and pharmacies, between the inconsistent pharmacy participation from last year and the new smoothing methodology muting the otherwise more real-time changes, it is clear that mandatory, more robust NADAC reporting is a Valentine we hope to receive.
Thanks to the American Economic Liberties Project for recently inviting Antonio Ciaccia to speak at their recent kick-off of their “Break Up Big Medicine” campaign.
Also, shout-out to Zach Brennan at Endpoints News for his write-up on the January drug price changes with great utilization of our box score dashboard.