A recent report submitted by Express Script shows a rise in prescription drug spending in the U.S. by 13.1 percent in 2014. So, who’s to blame?
It seems a new and expensive Hepatitis C drug released by Gilead’s Sovaldi and Harvoni contributed to the increase in specialty drug prescriptions. So if usually, specialty treatments represent only 1 % of all U.S. prescriptions, in 2014, these types of drugs accounted for 31.4% of the general drug spend. Also, in comparison to 2013, the Hep C drugs costs increased by an astonishing 742.6%.
These numbers were calculated for commercially insured patients. In 2014 out of the $979.96 spent on each member, $668.75 were used to pay traditional drugs. The remaining $311.11 were spent on specialty drugs.
Specialty drugs are advanced medications used in the treatment of complex or chronic illness such as multiple sclerosis or some types of cancer. Although said to be highly effective, most of them are too expensive. Sovaldi and Harvoni’s Hep C treatment, for example, can cost $84,000 for a course of treatment.
Most of additional costs come from the use of expensive drugs. If compared, traditional medication costs increased by 6.5 % according to the PBM (Pharmacy Benefit Management) while specialty drug prices saw an increase of 25.2%.
Express Script is trying to change this phenomenon. It has spoken against Sovaldi and Harvoni’s drug prices on many occasions. Now it plans on closing an exclusive deal with AbbVie to sell its rival Viekira Pak drug at a discount price. This move is the first of many that will take place during this pricing war. Gilead’s response was to establish a few deals, one of which is with CVS Health, Express Scripts’ main contender.
Express Scripts used this tactic because it will help clients save more than $1 billion in 2015. It will also convince its colleagues to follow the same strategy. The PBM organization made the following statement:
“These findings demonstrate the need for plans to take decisive action and more closely manage the pharmacy benefit to ensure all patients are able to achieve the best possible health outcomes at a price our country can afford.”
The company’s CMO Steve Miller considers that these measures need to be applied not only in the field of Hep C medication but also in regards to the PCSK9 drugs which are very expensive soon-to-be released cancer meds.
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