Study examines branded, specialty, generic drug prices between 2005 and 2009 Prices for generic drugs may be dropping, but increases in branded and specialty drug prices have offset those decreases, according to a new study. The study, conducted by AARP's Public Policy Institute, found that the cumulative change in drug prices from 2005 to 2009 was almost double the rate of inflation. As a result, the average annual cost of drug therapy continued to rise. The study was based on examinations of retail prices for the 514 drugs most used by Medicare beneficiaries. In 2009, while the rate of general inflation was -0.3%, the drugs increased in price by an average of 4.8%. Branded drugs increased in price by 8.3%, while specialty drugs rose by 8.9% and generic drugs decreased by 7.8%. "For the people who rely on these drugs, such relentless price increase have serious implications," AARP SVP public strategy Cheryl Matheis said. "Despite price reductions for generics, it's evident that the considerable increases in brand name and specialty drug prices are still leaving Americans with overall costs that are growing far faster than the rate of inflation." For the 469 drugs on the market since the end of 2004, prices increased by 25.6% from 2005 to 2009, while the general inflation rate was 13.3%. Consumers taking drugs to treat chronic diseases found that their average annual cost increased from $2,160 to $3,168.