Will Specialty Drug Pricing Be The Straw?

Published 5/27/15 in Employee Benefit News

ALP_H_BK_0010Over the next few years, drug manufacturers will release a host of new drugs that are more complex and, in many cases, more effective than we’ve had access to in the past. There will be better solutions for common problems, and new solutions for uncommon ones. Specialty drugs, many of them “precision therapies,” will offer tremendous promise for better health outcomes across the breadth of human health and treatment.

Not surprisingly, most of these drugs will have breathtaking price tags, often a high multiple of conventional drugs. Specialty drugs are an exploding growth industry, with spending rising almost 20 times as fast as conventional drugs. Unless something changes, in just another five years we’ll likely spend more on specialty than non-specialty drugs. Or, for that matter, on doctors.

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Specialty Drugs Will Drive Future Rx Spending Trend

Jane Sarasohn-Kahn

First published 5/19/11 on Health Populi

In the 2011 Medco Drug Trend Report, there’s good news and bad news depending on the lens you wear as a health care stakeholder in the U.S. On the positive side of the ledger, for consumers, payers and health plan sponsors, drug trend in 2010 stayed fairly flat at 3.7% growth. That’s due in major part to the increasing roster of generic drugs taking the place of aging branded prescriptions products. More than $100 billion (with a ‘b’) worth of branded drugs will go off-patent between 2010 and 2020, and the generic dispensing rate could reach 85% by 2020, Medco expects, especially looking at high-cost categories like statins. So generics are dramatically slowing drug cost increases overall.

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