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US Rx use down but brand drug prices up sharply: report

World News | May 14, 2009


Lynne Taylor

Last year, US price rises for branded drugs topped 8% to reach their highest level for five years, but increased use of generic drugs kept the year’s overall price inflation to 3.3%, says a new report.

US prescription drug utilisation fell 1.1% last year - largely due to over-the-counter (OTC) availability of widely-used allergy and gastrointestinal medications, plus safety concerns for certain medication classes - and generic drugs accounted for more than 64% of all prescriptions dispensed, says leading pharmacy benefit manager Medco, in its 2009 Drug Trend Report.

The leading drivers of sales growth for the year were specialty products, for which spending rose 15.8% - such products also accounted for 60% of the year’s overall 3.3% price inflation - plus, for the second year, rising sales of diabetes treatments.

“Safety issues and a transition to over-the-counter medicines had more to do with lowering utilisation than either an unhealthy economy or a healthy population,” said Robert Epstein, Medco’s chief medical officer. “An ageing America, combined with an obesity epidemic, has led to a surge in chronic conditions such as diabetes, high cholesterol, hypertension and heart disease. Until we successfully tackle this public health crisis, patients and payers will continue to see rising prescription and medical costs.”

The report notes that safety concerns led to declines last year in the use of osteoporosis drugs, hormone replacement therapy and medications used to treat chemotherapy-induced anaemia. In addition, product withdrawals mandated by the Food and Drug Administration (FDA) resulted in a drop in migraine and cough/cold treatment use.

Several medications became available without a prescription in 2008, reducing prescription drug utilization as patients probably continued their therapy with the non-prescription formulations. OTC availability of McNeil’s Zyrtec (cetirizine) suppressed allergy drug demand by 30%, while the OTC version of Schering-Plough’s laxative MiraLAX (polyethylene glycol 3350) lowered prescription gastrointestinal drug use in that category by over 9%. Without OTC availability of these medications, overall prescription drug utilization would have been flat compared with 2007, says the report.

Other significant features of the US market for last year are that: - sales of rheumatology drugs rose 17.2%, due to a near-10% rise in utilization and higher unit costs from specialty drugs; - spending on seizure drugs was up 13.9%, as a result of broadened indications to treat depression, neuropathic pain and fibromyalgia; - higher-cost cancer drugs helped push spending growth 11.8% higher, despite only a marginal increase in utilization; and - lipid-lowerers, allergy treatments and specialty drugs to treat anaemia were among the product categories which experienced reduced trends.

As brand-name drugs with over $66 billion in annualized sales are set to lose patent protection over the next five years, Medco is projecting US annual drug spending growth of 4%-7% to 2011, or an aggregate 14.7%-18.0% over the three-year period. Generic drugs should help to mitigate spending through this period, but growth is expected to resume as specialty drugs and new treatments paired with genetic screening make more of a presence in the marketplace, the firm forecasts.

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