CVS Caremark has released its annual report on drug trend and other issues. (CVS Trend Report) The trend information isn’t as useful as you might think, since you have to look very carefully at how it is calculated and from what groups and members. What would be really useful is a trend report on what is happening with what consumers actually pay for drugs–deductible, copays, coinsurance, full self-pay. But according to CVS, its book of business had an overall gross trend of one-tenth of a percent, with utilization and mix of drugs favorable, but unit pricing up. The non-specialty trend was actually down almost 4% but specialty was up over 18%, which is consistent with all the evidence indicating that spending increases are reasonable for most high-volume, chronic disease drugs, for which there often is a generic equivalent, but rising rapidly for specialty. The really bad news is that the pipeline is now heavily focused on specialty. Even large pharmas are successfully making the pivot from huge volume blockbuster brand-name drugs, to smaller population, but much higher priced, drugs. The report is themed around the “member” and how to improve the member’s experience. CVS highlights e-prescribing growth, more comprehensive and restrictive management of specialty drug channels and their enterprise digital strategy. Some specific disease areas were highlighted as well, largely for introduction of new drugs and the potential for higher spending. These included hepatitis C and multiple sclerosis. Looking forward, CVS projects about 1-5% spending growth in 2013, 2-7% in 2-14, 4-9% in 2015 and 5-10% in 2016, largely driven by specialty drugs and by provisions in the reform act. Not a pretty picture and one that should add to overall spending increase concerns, as drugs had been one of the slower growth areas in the last few years.
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About this Blog
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at [email protected].
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