2007 saw US Rx drug spending’s lowest rise in over 40 years, says govt

US health care spending grew 6.1% in 2002 to $2.2 trillion, or $7,421 per capita, the slowest rate of rise since 1998, the US government has reported today. Over half of this slowdown was due to the year’s 4.9% growth in prescription drug spending, which is a sharp tumble from 8.6% in 2006 and the smallest increase in more than 40 years.

Factors contributing to the prescription drug sales slowdown included the increasing use of generics, more patent expiries, the $4 prescriptions being offered by large retailers – beginning with WalMart in 2006 - and the rise in concerns over drug safety, according to the annual report of the Centers for Medicare and Medicaid Services (CMS) Office of the Actuary.

The prices of prescription drugs - which account for only around 10% of total US health spending - rose just 1.4% during 2007, compared with an increase of 3.5% for the previous year, and generic drugs accounted for 67% of all US prescriptions written, up from 63% in 2006, says the study, which was produced by the CMS’ National Health Expenditure Accounts Team.

Moreover, in 2007 the Food and Drug Administration (FDA) issued 68 serious warnings related to drug safety issues, compared with 58 in 2007 and 21 in 2003.

The other big factor in the overall slowing of health spending growth was the deceleration in expenditures by public health programmes such as Medicare and Medicaid which rose 6.4%, down from 8.2% in 2006. Privately-sourced health spending was up 5.8%, compared to 5.4% growth in 2006.

While the overall rise in national health care spending was down in 2007, it was still higher than the 4.1% rise in the consumer price index and accounted for 16.2% of US Gross Domestic Product (GDP), up slightly (0.2%) on the year before. Moreover, growth in the costs of doctor and hospital services, and those provided by Medicare, were at similar or higher levels than those seen in recent years, says the report, which appears in the current issue of the journal Health Affairs.

Retailer offers free antibiotics

Meantime, the major US grocery chain Giant Foods and its Stop and Shop subsidiary have said they will provide their customers with free antibiotics until March 21. Shoppers will need to bring in a prescription to receive the 36 generic antibiotics on offer by the chain, which is thought to be the first retailer to provide such a service. Giant Foods is also offering customers up to 90 days supply of a range of more than 350 generic drugs for just $9.99.