Managed Care

 

Costs for traditional meds static while specialty drug costs soar

MANAGED CARE June 2012. © MediMedia USA
Managed Care Outlook

Costs for traditional meds static while specialty drug costs soar

MANAGED CARE June 2012. ©MediMedia USA

The near future looks very different in terms of what will be spent on specialty medications as opposed to traditional drugs, according to Express Scripts’ 2011 Drug Trend Report. The company forecasts 20 percent growth for specialty medications from now to 2014. The study, based on random samples of pharmacy data of 4 million people, cites three reasons:

  • For the first time, HIV and transplant medication categories were considered when estimating the growth of specialty drug costs, and they are covered by pharmacy benefits.
  • Plan sponsors are moving away from buy-and-bill payment arrangements with doctors as specialty drug coverage migrates from the medical to the pharmacy benefit.
  • There’s been an onslaught of approvals of self-injected drugs, which usually fall under the pharmacy benefit.

Help may be on the way with the introduction of some biosimilars that could slow the cost increases beyond 2014.

All percentage changes on this page are per member, per month for members in the PBM’s commercial business.

Spending on specialty drugs to rise

Most costly specialty therapy classes

Inflammatory conditions (including rheumatoid arthritis, psoriasis, lupus, and gout), multiple sclerosis, and cancer have been the most expensive specialty drug categories for many years, and they will continue to top the list through 2014. They will be followed by drugs for HIV, a new category. Drugs for hepatitis C are expected to be in fifth place by next year.

Meanwhile, for the first time since Express Scripts started publishing its Drug Trend Report in 1997, the per-member, per-month cost of traditional medications will dip this year. “We expect [costs] to rise only modestly in 2013 and 2014, fueled primarily [by] increases in overall drug utilization.” The reason is patent expirations. “Cost per unit is expected to decline in 2012 and 2013 — due not only to the availability of more generic medications, but also to continued reductions in the cost per fill for generics.”

Historic low costs for traditional medications

Source: 2011 Drug Trend Report, Express Scripts, April 2012.

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