What is an NDC?
An NDC, or National Drug Code, is a unique 10-digit, three-segment numerical code assigned to medications in the United States. It is mandated under Section 510 of the U.S. Federal Food, Drug and Cosmetic Act. The NDC identifies the labeler, product, and trade package size of a drug[3][5].
Structure of an NDC
The NDC is composed of three segments:
- Labeler Code: Assigned by the FDA, this segment identifies the firm that manufactures, repackages, or distributes the drug.
- Product Code: Assigned by the firm, this segment identifies the specific strength, dosage form, and formulation of the drug.
- Package Code: Also assigned by the firm, this segment identifies the package sizes and types[3][5].
Example: NDC 82584-0605
For the NDC 82584-0605, let's break it down:
- Labeler Code: 82584
- Product Code: 060
- Package Code: 5
This NDC would identify a specific drug product, its strength and formulation, and the package size in which it is sold.
Market Analysis
Drug Identification and Listing
To analyze the market for a drug with the NDC 82584-0605, one must first identify the drug using the NDC Directory published by the FDA. This directory includes all electronically listed drugs in their final marketed form, including prescription drugs, over-the-counter (OTC) drugs, and insulin products[1][3].
Price Trends
Price trends for drugs can be highly volatile. The FDA and other regulatory bodies track price increases, especially extraordinary ones. For instance, a study by the Government Accountability Office (GAO) found that brand-name drug products that had extraordinary price increases often shared characteristics such as therapeutic class, cost, or packaging. The median price of such drugs increased significantly, from $1.66 per unit to $4.70 per unit after the increase[2].
Recent Price Transparency Reports
Recent reports on prescription drug price transparency highlight significant price increases. For example, in 2022, the largest price increase reported was a 2,527% increase for a generic naproxen manufactured by Hikma Pharmaceuticals. Such drastic increases can impact market dynamics and consumer affordability[4].
Price Projections
Factors Influencing Price
Several factors influence drug prices:
- Therapeutic Class: Drugs in certain therapeutic classes, such as central nervous system agents or anti-infective agents, are more likely to experience price increases[2].
- Regulatory Environment: Changes in regulatory policies or enforcement can affect pricing strategies.
- Market Competition: The level of competition within the therapeutic class can impact pricing.
- Production Costs: Increases in raw material costs, manufacturing costs, or other operational expenses can lead to higher prices.
Historical Data
Analyzing historical price data for the specific NDC can provide insights into future price trends. For instance, if the drug has experienced steady price increases in the past, it may continue to do so unless there are significant changes in the market or regulatory environment.
Market Demand
Demand for the drug, influenced by factors such as disease prevalence, treatment guidelines, and patient preferences, also plays a crucial role in price projections. High demand with limited supply can drive prices up.
Practical Steps for Market Analysis
Use NDC Directories and Tools
Utilize the FDA's NDC Directory and other tools like the NDC Code Lookup to gather detailed information about the drug, including its labeler, product specifics, and packaging details[1][5].
Analyze Price Data
Review historical price data from sources like the Red Book or other pharmaceutical pricing databases to identify trends and patterns[2].
Consult Industry Reports
Refer to recent industry reports and studies on prescription drug pricing to understand broader market trends and regulatory impacts[4].
Key Takeaways
- NDC Structure: Understand the three segments of the NDC to identify the drug, its strength, and packaging.
- Market Analysis: Use FDA directories and industry reports to analyze market trends and price history.
- Price Projections: Consider factors such as therapeutic class, regulatory environment, market competition, production costs, and demand when projecting future prices.
- Regulatory Compliance: Ensure that the drug is listed and compliant with FDA regulations to avoid any disruptions in supply or pricing.
FAQs
Q: What does the NDC 82584-0605 identify?
A: The NDC 82584-0605 identifies a specific drug product, including its labeler, strength, dosage form, formulation, and package size.
Q: Where can I find detailed information about a drug using its NDC?
A: You can use the FDA's NDC Directory or other NDC lookup tools to find detailed information about the drug.
Q: What factors contribute to extraordinary price increases in prescription drugs?
A: Factors such as therapeutic class, cost, packaging, and market competition can contribute to extraordinary price increases in prescription drugs.
Q: How often is the FDA's NDC Directory updated?
A: The FDA's NDC Directory is updated daily to include the latest information on listed drugs[1].
Q: Can NDCs help in controlling drug costs?
A: Yes, NDCs help ensure correct payment and control of drug costs by providing a precise identifier for each drug product, which can save time and effort in billing and verification processes[5].
Sources
- FDA NDC Directory - YouTube
- GAO-10-201 Brand-Name Prescription Drug Pricing - GAO
- National Drug Code Database Background Information - FDA
- Prescription Drug Price Transparency Results and Recommendations - Oregon Department of Consumer and Business Services
- NDC Code Lookup - AAPC
