While the rate of growth in drug spending has leveled off in recent years, it remains an important category and pharmaceuticals are often the source of innovation in patient treatment. A new report from IMS gives a plethora of views of industry results and trends for 2011. (IMS Report) The report notes, among other things, that 2011 saw the highest number of FDA approvals of new molecular entities in over a decade, and many of these represented strong clinical advances in treating the disease they are prescribed for. Per capita utilization of drugs dropped, which may be concerning, particularly as cost-sharing increases, potentially leading to more unfilled prescriptions. Consistent with other reports, IMS finds that overall drug spending growth is slow, at .5% on a per capita basis, but is sharply divided between generic drugs, which are lowering the trend, and specialty drugs, which are rising in price and utilization rapidly. Total spending was estimated at $320 billion in 2011.
The decline in per capita drug use parallels the drop in office visits and hospitalizations. Seniors had the most notable decline, especially in blood pressure compounds. Some other drugs saw significant declines in usages as well, often for safety reasons. Seniors faced less cost-sharing on drugs as Part D donut hole subsidies increased, but commercial insurance enrollees had an increase in average copay amounts, driven largely by copays on branded drugs. Branded drug price increases accounted for much of the overall increase in spending from 2010 to 2011. Almost a third of spending is in just five therapeutic classes: cancer, respiratory, cholesterol agents, diabetes and mental health. Spending growth, however, is greatest in less common diseases which are treated with often very expensive specialty drugs. The most patients are prescribed an anti-hypertensive, 42 million, followed by statins at about 20 million and anti-depressives at 18.5 million. Commercial insurers pay for about two-thirds of prescriptions. Chain stores have by far the greatest share of both prescriptions and spending.