The nation’s largest pharmacy benefits manager says prescription drugs spending rose 13 percent last year, the largest annual increase since 2003. Express Scripts says the gains were fueled by pricey specialty drugs that accounted for about 31 cents of every dollar spent on prescriptions even though they represented only 1 percent of all U.S. prescriptions filled.
New hepatitis C therapies with high price tags and the exploitation of loopholes for compounded medications drove a 13.1% increase in U.S. drug spending in 2014 – a rate not seen in more than a decade. The report says that these findings “demonstrate the need for plans to take decisive action and more closely manage the pharmacy benefit to ensure all patients are able to achieve the best possible health outcomes at a price our country can afford.”
Inflammatory conditions, multiple sclerosis and cancer remained the top three specialty therapy classes for the fifth consecutive year, collectively contributing to 55.9% of the spend for all specialty medications billed through the pharmacy benefit in 2014.
Spending on traditional medications continues to rise as a result of compounded drugs, which emerged in the top 10 traditional therapy classes for the first time and accounted for 35% of the increase in spending. However, Express Scripts expects spend on compounded medications to decline sharply in 2015 due to widespread adoption of our compound utilization management solution. Express Scripts’ compound management solution, implemented in mid-2014, will save its clients more than $1.9 billion in 2015 that would have otherwise been wasted on compounded medications that do not provide a proven clinical benefit.
Drugmaker consolidation and drug shortages also led to increases in traditional drug trend, which rose to 6.4% in 2014. Half of the top 10 therapy classes experienced negative trend in 2014 due to generics. While it expects that trend to persist for the next two years, some categories will face challenges from continued drugmaker consolidation, which can lead to price increases from drug shortages and decreased competition.