Pharmacy and neighborhood-level variation in cash price of diabetes medications in the United States.

BACKGROUND: Diabetes medications place significant financial burden on patients but less is known about factors affecting cost variation. OBJECTIVE: To examine pharmacy and neighborhood factors associated with cost variation for diabetes drugs in the US. RESEARCH DESIGN, SUBJECTS AND MEASURES: We used all-payer US pharmacy data from 45,874 chain and independent pharmacies reflecting 7,073,909 deidentified claims. We divided diabetes drugs into insulins, non-insulin generic medications, and brand name medications. Generalized linear models, stratified by pharmacy type, identified pharmacy and neighborhood factors associated with higher or lower cash price-per-unit (PPU) for each set of drugs. RESULTS: Cash PPU was highest for brand name therapies ($149.4±203.2), followed by insulins ($42.4±25.0), and generic therapies ($1.3±4.4). Pharmacy-level price variation was greater for non-insulin generic therapies than insulins or brand name therapies. Chain pharmacies had both lower prices and lesser variation compared with independent pharmacies. CONCLUSIONS: Cash prices for diabetes medications in the US can vary considerably and that the greatest degree of price variation occurs in non-insulin generic therapies.