The average increase in the price manufacturers charge for brand name prescription drugs. significantly outpaced inflation for the fifth consecutive year, according to a new figures from the AARP – a non-profit organisation, which represents millions of US citizens aged 50 years and older.

The AARP’s “Rx Watchdog Report” assessed the changes in the prices prescription drug manufacturers charged wholesalers in 2004 for 195 brand-name medicines widely used by Americans aged 50 and older, and found that the average price increase during 2004 was 7.1%, versus general inflation of 2.7% in 2004. As well as being the fifth year in a row the price hikes have outpaced inflation, the AARP says that 2004 saw the biggest one-year increase levied in any of the past five years.

Since the end of 1999, the report claims that the manufacturers of 153 of these brand name drugs have raised their prices over two-and-a-half times the rate of general inflation. During that time, manufacturers’ drug prices have increased by an average of 35.1%, compared to an inflation rate of 13.5%.

Amongst the 25 top selling brand-name drugs in 2003, 16 drugs had price increases at more than double the rate of inflation. The biggest rise came from Sanofi-Aventis’ sleep drug, Ambien (zolpidem), which witnessed an 11.9% price hike.

Bil Novelli, AARP chief executive, said: “Much more needs to be done to slow down spiraling drug pricing.”

However, a report also released yesterday by the Pharmaceutical Research Manufacturers of America contested the AARP’s findings, saying that consumer medical care costs rose 4.7% since passage of the Medicare Modernisation Act in early 2004. In addition, it claims that prescription drug price inflation has been in line with overall medical inflation since January 2000, according to analysis of the government's publicly available consumer price index, which showed that CPI drug prices increased at an annual rate of 4.1% through to February 2005. Medical inflation during that period had a growth rate of 4.4%.