A new report from the Center for Medicare and Medicaid Services (CMS) reported that overall healthcare spending in 2012 was only up by 3.7% which is very comparable to the previous years since 2009, ranging from 3.6%-3.8% over the period. Drug expenditures did their part in keeping costs down. Drug revenues in 2012($263 B) were only up by 0.4% as opposed to 2.5% the prior year. It is believed this may be due to a combination of big drugs coming off patent - e.g. Lipitor, Plavix, and Singulair -- and the enactment of the Affordable Healthcare Act. Generic drugs now make up 77% of scripts in the US versus 70% after 2011. IMS says the utilization rate can only go a few percent higher before it plateaus.
The other notable trend is the rise to power of PBMs (pharmacy benefits managers). PBMs have excluded some major new drugs from their 2014 National Formulary -- such as Xeljanz, Breo Ellipta, Simponi and Stelara. Express Scripts (one of bigger PBMs) also indicates it will take aim at holding costs down on new hepatitis C drugs -- like Solvadi. There will continue to be more pressure on comparative effectiveness data to justify using any of the new VERY expensive products. See Fierce Biotech 1 & 2.
Posted by Bruce Lehr Jan 7th 2013