Competition isn’t enough: Medicare still overpays for abiraterone

Following the 2018 patent expiration of abiraterone, a hormonal therapy for prostate cancer, the drug experienced a substantial influx of generic manufacturers and a marked decline in gross list prices. Using Medicare Part D reimbursement (gross pricing) data from 2019 to 2023, we analyzed trends in both pricing and market share post-generic entry. Among 19 manufacturers that entered the market, generic versions quickly dominated market share. However, despite the availability of significantly lower-cost options, Medicare Part D continued to reimburse for versions with gross prices 10–40 times higher than the cheapest available alternatives based on aggregate manufacturer-level averages. This case study illustrates how, even after generic entry, medication pricing can remain uncompetitive, suggesting inefficiencies in reimbursement dynamics. Policy tools such as reference pricing may offer a pathway to mitigate excessive spending and promote value-based purchasing in Medicare Part D.