Drug Trends
- Current trends increasing ~6% (IMS reports 8.3% overall for 2006), normally drug trends increase 15% – 20%; new generic drug introductions have mitigated this trend
- Health Care Costs 101 for 2007, from the California HealthCare Foundation, does a great job of dissecting and presenting trends for the various components of health care
- Over six years, new drug introductions account for approximately 2/3 of price (see AWP litigation info) and utilization increases; better evaluation of new drug launches lead to effective trend management approaches
- Specialty Drugs will add to the cost burden and have a pharmacy trend approaching 30% (IMS reports 20% overall for 2006, see link in first item)
- A primary focus on unit cost (e.g., PBM Deals) ignores the major drivers of cost and poor quality; this Medicaid analysis provides a good example
- Benefit design can help control costs, but may have unintended consequences
- Drug sampling drives more utilization than direct-to-consumer advertising (DTCA)
- Changes in treatment rates for chronic medical conditions are contributing to increased utilization
- 80 – 100 new drugs, new dosage forms, and new indications await FDA approval
- Rx to OTC conversions and patent expirations will help control trend
- Your focus should be on increasing generic use, not Rebates
- Drugs with sales of $30 billion could loose patent protection over the next three years
- Minimizing drug therapy problems likely provides the greatest savings in health care costs
