PBM Catamaran, which has just agreed to be acquired by UnitedHealth for a nice price, released its version of a drug trend report. (Catamaran Report) At a high level, the firm experienced an overall trend of 5.7% per member per month in drug spending, up from 2.4% in 2013. The higher growth rate was driven largely by unit cost, not utilization. Traditional drug spend increased 1% while specialty spending went from a 14.3% rise in 2013 to a 20% increase in 2014. For 2015, Catamaran is forecasting trend between 5.6% to 9.2%. In 2014, utilization, measured on a scripts per member per month, contributed a 2.2% decrease to overall trend, while quantity dispensed showed a .3% decline. Unit cost accounted for a 6.7% increase and drug mix rose 1.5%. The generic dispensing rate increased 2%, but even generics showed unit price increases last year, for reasons we have discussed in other posts. And once again while traditional drug trend was a manageable 2%, specialty trend rose 20% in 2014, much faster than 2013’s 14%. The top therapeutic classes by total drug spend, and their 2014 trend, were diabetes, with a 21% increase, driven by introduction of new classes of compounds, cholesterol-lowering with a 6.3% decrease, partly due to changes in guidelines that reduced some utilization, and asthma/COPD, a 3% decline.
Within payer segments, employer self-funded plan trend was 7.2%; commercial health plan trend was 5.8%, Medicare was 10.7%, Medicaid was 10.3% and workers’ compensation a lone bright spot at a 5.3% decrease. The health exchange population was quite expensive, as they used many more HIV and hepatitis C meds than As other PBMs have, Catamaran expressed concern for future pricing, as the FDA approved 41 new drugs in 2014, the most in 15 years, and has a long pipeline of new drugs, many expensive specialty compounds. The drug category may be seeing a perfect storm of events that leads ongoing double-digit spending increases–fewer drugs going generic, generic drug price increases that in some cases are astoundingly large, many new specialty drugs with very high course of treatment price tags and an aging population with a substantial need for drug therapies.