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Why is Abilify So Expensive?

January 3, 2020

high drug prices

Man sitting on a couch

Every year, millions of people in America are diagnosed with a mental-health condition. According to the National Alliance on Mental Illness or NAMI, as many as 19.1% of adults were diagnosed with mental illness in 2018, including 4.6% of patients suffering from a serious mental-health disorder. That's a total of 46.7 million people in a given year, with more than 11.4 million who will continue to suffer from severe ongoing symptoms.

For many Americans, dealing with mental illness means going on a prescription medication. While these medications can be life-changing, they also can be quite expensive. Abilify — the main drug we'll look at in this article — has a retail price of between $550 to $900 per month, depending on where you look. While the generic version is cheaper, the cost for the brand-name version shows a common problem many suffers of mental illness face: to be blunt, when new drugs designed to treat mental illness come to market, they're often prohibitively expensive.

Finding a drug that works to treat your mental illness can be frustrating as it is — you don't need an additional financial burden on top of that. Likewise, the existence of discontinuation syndrome (as well as how dangerous it can be to skip doses of medication) makes running out or being unable to afford your medication untenable.

So why is Abilify — and other medications used to treat mental illness — so expensive, and is there anything you can do to lower your prescription drug costs?

A Brief History of Abilify

Abilify was discovered by Japanese scientists at Otsuka Pharmaceutical Co., and was released for distribution in 2002. Originally, it was intended to treat schizophrenia. Not long after it was found to be effective for treating acute manic episodes of bipolar disorder.

But five years later, the FDA approved the drug for treatment of major depression as well. Abilify continues to be prescribed to treat these psychiatric disorders in adults. Children ages 6-17 diagnosed with Tourette's syndrome and autistic disorder may also use Abilify to treat severe agitation.

Why is Abilify So Expensive?

After 17 years, Abilify is still one of the most profitable antipsychotic drugs sold in America today. In fact, between 2013 and 2014, the brand name drug grossed $7.2 billion, which was a greater profit earned than any single drug ever sold. Millions of Americans are taking Abilify or its generic aripiprazole every year. So why after so many years does Abilify continue to be one of the most expensive antipsychotic drugs on the market?

Unfortunately, the answer to this question is both disheartening and complicated. There is a long chain of distribution that runs from manufacturers down to consumers, and there are many factors come into play when considering all the reasons why a particular medication costs as much as it does.

There is no singular reason to blame, but it's safe to say that prescription drug price fixing, spread pricing, marketing costs, corporate greed, and (to a lesser extent) research and development are all believed to play a role in causing Abilify's price to be so high.

Pharmaceutical companies and pharmacies function just like any other corporate for-profit company in America. Just because they are selling a product that people desperately need, does not necessarily mean that they always have the customers' best interest in mind.

The possible reasons lie within the organizations themselves: The pharmaceutical companies, the Food and Drug Administration, drug wholesalers, as well as the particular pharmacies dispensing the medication. Before a prescription reaches a customer's hands, it has to pass through a long chain of distribution. The various faulty practices that exist at each level need to be explored in order to better understand why various prescription medications such as Abilify are so expensive.

Pill bottle with white pills

Prescription Drugs and Price Fixing

One potential reason for Abilify's high price is known as "price fixing." Pharmaceutical companies frequently engage in this illegal practice in order to control profit margins. By negotiating drug costs to ensure that competition remains similar between parties, everyone can remain in business.

But if any one company decides to lower its prices, then the competition must follow suit if it's going to remain in the game. With price fixing, everyone wins — except the consumer. The purpose of antitrust laws is to prevent the formation of monopolies by colluding to control the market. The problem is, medications are a necessity, not some frivolous commodity.

We cannot just change out medications like we can, say, a pair of old shoes. But it can take years before legislation recognizes the issue and penalizes participants accordingly. Companies host conversations privately often in inconspicuous social settings so as not to raise suspicion.

Atypical antipsychotics are still relatively new to the drug market and hard evidence of price fixing directly involving Abilify is still sparse. Major federal investigations began in 2014, but the companies involved never became public knowledge. While this investigation did not target Abilify, and there's no evidence that Abilify has had its price manipulated, it's hard to not be suspicious.

What is known, however, is that competition in the generic drug market lowers prices so that even if a particular brand name prescription drug is at first expensive, over time the price should lower as more competitors enter the market. This has not been the case with aripiprazole, the generic version of Abilify, which still retails at an average of about $700. At that price, aripiprazole is still one of the most expensive antipsychotic generic prescriptions on the market.

Price Fixing and Generic Drugs

In a recent article entitled Price Fixing Case Reveals Vulnerability of Generic Drug Policies, the author Anthony W. Mulcahy, a Senior Policy Researcher and Faculty member at RAND Graduate School, displays the disparity between the lack of competition at the generic drug level.

Once a patent for a brand-name drug has expired, the market opens up to generic competitors. Unfortunately, as the author points out, drug companies are often incentivized not to produce generic medications as soon as they are legally able. He states, "the settlements usually allow the generic drug maker to enter the market — just not immediately — in exchange for a large lump-sum payment."

In addition to this delayed production, only one generic drug of any given brand is allowed to seek approval from the FDA before another generic drug can apply for approval. Although there are several antipsychotic drugs on the market, there is currently only one generic form Abilify, making it exorbitantly expensive. Without competition, the drug company can set its price wherever it wants.

Spread Pricing and Pharmacy Benefit Managers

Pharmacy Benefit Managers serve as a middlemen between insurance companies, manufacturers and pharmacies. In an article by the senior editor for Health Care Finance, Susan Morse defines spread pricing as "the amount between what the health plan pays the PBM and the amount the PBM reimburses the pharmacy for a beneficiary's prescription."

PBMs were originally put in place to represent the interest of consumers, keeping drug manufacturers costs in check. PBMs are most often used to represent Medicaid organizations, but they also serve other insurers and employers as well.

Importantly, PBMs are guarded about how much they charge for their services, making it hard to estimate how much of an impact they have on the market. The amount of power that PBMs have in the pharmaceutical industry is mostly unknown.

What is known, is that the PBMs are offered incentives through rebates to promote the distribution of drugs to pharmacies. If rebates are lowered or withdrawn, PBMs have the ability to remove medications from their formulary, a list of prescriptions covered by insurance companies.

In an article, formulary positioning is compared to "paying for shelf space in grocery stores." While it isn't illegal, the spread is grossly rising and PBMs are pocketing rebates that should be shared with consumers.

Advertising Executive in a business suit

Drug Advertising in the US

The U.S. is only one of two countries in the world that allows pharmaceutical companies to advertise direct to consumers. An estimated $30 billion was spent on drug advertising in 2016 alone, with TV ads accounting for as much as 80% of advertising costs.

Shortly after Abilify was approved to treat major depression, commercial advertisements started airing across America. The unique selling point focused on adults who were already suffering from major depression and taking an antidepressant.

Abilify could be used as an add-on drug to treat symptoms that were not successfully diminishing with just an antidepressant. The number of people who suffer from major depressive disorder is much greater than those with schizophrenia and bipolar disorder. In fact according to the US National Library of Medicine, "depression currently ranks as the fourth leading cause of global disease burden, with the disorder affecting 13-14 million adults in the United States in a given year. By 2020, depression is projected to be the second leading cause of disease burden worldwide after heart disease."

Antidepressants are one of the most commonly prescribed medications in America, with 11.4% of people aged 20-59 taking an antidepressant last year. Bristol Meyers found a new lucrative market and took full advantage of the opportunity to advertise about its new breakthrough treatment. Many experts argue that medications should be suggested by doctors — not patients — which is what pharmaceutical advertising often causes. While this does give patients more agency in their care, it also might make them more willing to try a drug that might not be a good fit for them and even insist on taking such a drug.

Yet, Bristol Meyers didn't stop there. The atypical drug somehow became used as off-label treatment for Alzheimer's disease. The company was fined $19.5 million for their advertisement foibles. To be clear, at the time, there was no evidence to support this off-label usage. While the drug was indeed approved by the FDA as an add-on, some question the amount of research produced to support this idea.

Abilify Isn't the Only Expensive Mental Health Drug

We'd love to report that Abilify is the only drug caught up in this web — but that just isn't the case. There are numerous other drugs in this space that we could've featured instead of Abilify. For example:

  • Trintellix costs roughly $410 for a 30-day supply of 5mg tablets. (Source)
  • Fetzima costs roughly $392 for a 30-day supply of 40mg tablets. (Source)
  • Viibryd costs roughly $290 for a 30-day supply of 10mg tablets. (Source)
  • Latuda costs roughly an outrageous $1,287 for a 30-day supply of 20mg tablets. (Source)

And that's just the tip of the iceberg.

Why are all of these drugs so expensive? As is the case with Abilify, while we can't know the exact reasons, we can make an educated guess. Regardless of the reasons why, the one thing we can confidently say is that these prices are outrageous. No one should be forced to pay over a thousand dollars a month just to feel normal.

Abilify is Expensive — But We Can Help

At NorthWestPharmacy.com, we know how crucial these drugs are — and just how much they can help people. Yet, we also know that their steep costs can prevent people from using them — or force them to stop using them.

We offer Abilify for a price much lower than what can be found in most places in the United States. We also offer many other medications used for mental illness for a significantly reduced price.

It's our goal to ensure that everyone that needs these medications can get them at a price that's affordable. We are dedicated to that goal and have helped hundreds of thousands of satisfied customers purchase cheaper medications. That's why we proudly display our over 375,000 customer reviews and our average 4.7/5 Trustscore right on our home page.

Have questions? Want to know more? You can always reach us at 1-866-539-5330. You can always visit NorthWestPharmacy.com to see if we can provide your prescription for a lower cost.

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