AARP's Public Policy Institute finds that retail prices for generic prescription drugs widely used by Medicare beneficiaries fell between 2005 and 2009; this is consistent with the pattern that we have seen since initiating our ongoing series of studies on prescription drug prices in 2004. In 2009, the retail prices for 185 generic prescription drugs widely used by Medicare beneficiaries fell by an average of 7.8 percent. The general inflation rate, according to the Consumer Price Index for all items, fell by 0.3 percent over the same period. This report presents annual and five-year cumulative price changes through the end of 2009, using both rolling average and point-to-point estimates. The first set of findings shows annual rates of change in retail prices for widely used generic drugs from 2005 through 2009, using both rolling average and point-to-point measures. The rolling average measure also is used to examine the distribution of price changes as well as differences in average percentage retail price changes for individual manufacturers and by therapeutic categories. The second set of findings summarizes the cumulative impact of retail drug price increases that have taken place during the five-year period from 2005 through 2009.
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