US Drug Pricing Monitor "UBS Evidence Lab inside: Generic Sell-Side Pric..."

Research evidence excerpt

US Drug Pricing Monitor "UBS Evidence Lab inside: Generic Sell-Side Pric..."

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US Drug Pricing Monitor Equities

AmericasUBS Evidence Lab inside: Generic Sell-Side Prices

Decline ~13% Y/Y in April Healthcare

Kevin Caliendo

Analyst

kevin.caliendo@ubs.com

Generic Sell-Side Px Deflates Further in April vs. C1Q26 +1-212-713 3630

Andrea Alfonso

The average generic drug in the dataset (> Access Dataset) as of April 30th saw its sale Analyst

price (distributor sell-side price to retailers) decline -12.8% y/y in April vs. -10.2% y/y in andrea.alfonso@ubs.com

1Q26, higher than the -9.1% in 4Q25 and the -7.8% in C3Q25/-3.0% in C2Q25. +1-212-713 1342

Importantly, our data provider observed that overall generic deflation has been Ashwani Verma

consistent with prior years when considering a typical pharmacy chain's or PBM's mix. In Analyst

a given month, data can be skewed by timing of generic introductions. Through June, ash.verma@ubs.com

we expect overall GRx pricing will be impacted by cuts to Revlimid, Farxiga, Tasigna, +1-212-713 4059

Sprycel and Promacta.

Generic PAC-to-WAC Spreads Widened in 1Q26 But Generally PAC Are More

Volatile. For generic drugs, Pharmacy Acquisition Cost (PAC) fell -12.8% y/y in April vs.

-10.2% in C1Q26. Meanwhile, Wholesaler Acquisition Cost (WAC) declined -2.7% in

April vs. -2.0% in 1Q26 vs. -2.0% in C4Q25. In percent terms, the spread between PAC

and WAC widened to -1017bps in April vs. -818bps in C1Q26 vs. -712bps in C4Q25 (see

Figure 3). Theoretically, PAC declining at a greater magnitude than WAC declines would

be negative for wholesaler spreads/margins. However, our data provider also indicates

that for about half of all generic drugs, acquisition costs shift around more frequently