Pharma Giants Exploit Loophole, Hike Asthma Drug Costs

The discontinuation of Flovent in December 2023 by Glaxo Smith Kline (GSK) and its replacement with an authorized generic version has led to significantly higher costs for asthma patients. This move allowed GSK to avoid federal price limits, but many families found the new generic to be more expensive and less likely to be covered by insurance. One pharmacy benefit manager reported that the net cost for the authorized generic was five times higher than Flovent for the average customer by the first half of 2024.

Senator Hassan has criticized GSK's actions, estimating the company saved $367.6 million by avoiding Medicaid rebates. She plans to support legislation to prevent other companies from exploiting similar loopholes, stating that "big pharma understands it cannot price gouge and get away with it." The Boston Children's Hospital survey found over half of clinicians reported difficulties obtaining prior authorization for alternative asthma treatments and faced product shortages.

GSK stated it offers a program for free medication and caps out-of-pocket costs at $35 for eligible patients across nine of its inhalers. However, the company is not involved in cost or insurance negotiations for its authorized generic, which are handled by Prasco Laboratories. As of the latter half of 2024, 12 percent of families still struggled to obtain adequate asthma treatment due to cost, availability, or coverage issues.