Prescription Drug Spending in 2012

Jane Sarasohn-Kahn

Posted 11/3/11 on Health Populi

growth in prescription drug costs covered by employers and Rx plan sponsors are driving them to adopt a long list of utilization management and price-tiering strategies looking to 2012, according to the 2011-2012 Prescription Drug Benefit Cost and Plan Design Report, sponsored by Takeda Pharmaceuticals.

The average drug trend for 2011 — that is, the average annual percentage increase in drug cost spending — was 5.5%, 1.5 percentage points greater than general price inflation of about 4%. The generic fill rate was 73% of prescription drugs purchased at retail. While drug price inflation is expected to increase in 2012, plan sponsors will implement several programs targeting enrollees who are most responsible for high cost and volume Rx consumption; the most popular programs will be disease management (to be used by 62% of plan sponsors), therapeutic substitution (50%), and outbound telephone calls (42%), retrospective drug utilization review (DUR, 40%), and face-to-face pharmacist consults (39%). Disease management and retrospective DUR both fell in use since 2010. Utilization management programs are also commonly integrated into prescription drug plan designs, with the most common tactics being prior authorization, quantity limits, and limits on “refills-too-soon.” Step therapy, too, is growing in use, particularly for medications treating depression, asthma, high cholesterol, and high blood pressure.

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Branded Prescription Drug Prices Increased Between 2006-2010 While Generic Prices Fell

Jane Sarasohn-Kahn

First published 3/15/11 on Health Populi

The Federal government covers about $1 in every $3 of spending on prescription drugs in the U.S. That equates to $78 bn of the total $250 bn spent on Rx in 2009. Between 2006 and 2010, the indexed cost of the usual and customary price for commonly used branded prescription drugs grew by 8.3%; in that period the price of commonly used generic drugs fell by 2.6%. The General Accounting Office (GAO), those nonpartisan bean-counters in Washington DC, analyzed pricing trends of prescription drugs over the most recent five years, based on changes from first quarter to first quarter in each subsequent year.

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