and Medicine for Seniors
Boomers, other seniors
drive record spending for drugs
Drugs for hepatitis C,
compounded medications push prices higher
10, 2015 The money spent on drugs in the U.S. increased at a faster
rate in 2014 13.1 percent than in any year for the last decade. The
culprits, according a report by Express Scripts, were new high priced
medicines for hepatitis C and the exploitation of loopholes for
compounded medications. Most hepatitis C patients are senior citizens.
The vast majority of persons living
with hepatitis C are baby boomers (individuals born from 1945 through
1965) now senior citizens, according to the Centers for Disease
Control and Prevention. The CDC has determined, Testing all baby
boomers properly is critical to stem the increasing toll of death and
disease from hepatitis C in this nation.
The burden of chronic hepatitis C virus infection
in elderly persons is expected to increase significantly in the United
States during the next 2 decades.
Hepatitis C and compounded
medications are responsible for more than half of the increase in
overall spending. Excluding those two therapy classes, 2014 drug trend
(the year-over-year increase in per capita drug spending) was 6.4
medications biologic and other high cost treatments for complex
conditions, such as multiple sclerosis and cancer accounted for more
than 31 percent of total drug spending in 2014.
As Express Scripts forecasted
last year, specialty drug trend more than doubled in 2014, to
30.9 percent. Hepatitis C medications accounted for 45 percent of the
total increase in specialty spend despite having the second lowest
prescription volume among the top 10 specialty conditions. Medicare
plans required to follow Medicare Part D formulary guidelines were
the hardest hit, as their annual specialty drug spend increased 45.9
past several years, annual drug spending increases have been below the
annual rate of overall healthcare inflation in the U.S., but that
paradigm is shifting dramatically as prices for medications increase at
an unprecedented and unsustainable rate," said
Glen Stettin, M.D., Senior Vice
President, Clinical, Research and New Solutions at Express Scripts.
"Now, more than ever, plans need to
tightly manage the pharmacy benefit, implement smarter formularies,
control compounded medication use and offer the right clinical support
to ensure all patients are able to achieve the best possible health
outcomes at a price our country can afford."
spent nearly 743 percent more on hepatitis C meds in 2014 than it did in
2013. Express Scripts'
hepatitis C solution, which makes Viekira Pak (ombitasvir/paritaprevir/ritonavir
packaged with dasabuvir) available to all hepatitis C patients and
guarantees successful completion of therapy through Accredo, is expected
to save our clients
$1 billion in 2015.
treatments for hepatitis C are just one example of non-orphan drugs with
orphan-drug price tags. Future pharmaceutical innovations, such as new
cancer drugs and PCSK9 inhibitors for high blood cholesterol, will
continue to challenge payers. Projected to command an annual cost as
$10,000 per patient, and potentially
reaching a patient population eventually as large as 10 million
Americans, PCSK9 inhibitors alone could one day cost the U.S. healthcare
system an estimated
$100 billion per year.
Closely Managed Plans
Mitigate Spend Increases
Express Scripts' solutions, including formulary and
utilization management programs, and use of Express Scripts' home
delivery pharmacy, help payers improve patient care and benefit
affordability. More than 15 percent of Express Scripts' clients spent
less, per capita, on prescription drugs in 2014 than in 2013.
sub analysis of the Drug
Trend Report found that, compared to payers with less managed pharmacy
plans, payers that implemented four or more cost-management programs
achieved nearly zero drug trend and spent nearly 30 percent less per
member on traditional (non-specialty) medications, those which treat
common chronic conditions, such as diabetes.
A similar analysis shows that the annual increase
in specialty spending is 32 percent less for employers with a tightly
managed specialty pharmacy benefit compared to employers with an
unmanaged benefit. The study which examined 851 clients, 20 percent of
which employed no utilization management programs for specialty also
revealed that tightly managed programs saw higher average medication
adherence rates in top specialty therapy classes, such as multiple
sclerosis and pulmonary conditions.
Formulary Design Delivers Cost Savings with Low
Many plan sponsors countered brand-drug price
inflation by implementing the 2014 Express Scripts National Preferred
Formulary, which excluded 48 products from coverage, achieved a 3.9
percent decrease in drug spending among the affected therapy classes,
more than $750 million in savings. The
excluded products represented only about 1 percent of all the products
on the market, and in all cases, patients had safe and effective
alternatives covered by their plan. Drug costs in those same therapy
classes increased 7.2 percent among plan sponsors who did not adopt the
Plans participating in the National Preferred
Formulary in 2014, and continuing in 2015, have seen the number of
patients impacted by formulary exclusions decline significantly, while
realizing cumulative savings of more than $2.2
Compounded Medications Drive Increased Spending
on Traditional Medications
Spending on traditional classes of medications
continues to rise as a result of compounded drugs, which emerged in the
top 10 traditional therapy classes for the first time. Despite having
the least number of prescriptions among the top 10 classes, compounded
medications accounted for 35 percent of the increase in spending, the
most of any traditional therapy class of drugs.
However, Express Scripts expects spend on
compounded medications to decline sharply in 2015 due to widespread
adoption of our
compound utilization management
solution. Implemented in mid-2014, this program will save
clients more than $1.9 billion in 2015
that would have otherwise been wasted on compounded medications that do
not provide a proven clinical benefit.
"Express Scripts' actions to close the compound
loophole provided our clients with a swift and effective solution to
this costly concern," said Dr. Stettin. "There is no charge to clients
for this new solution, only the benefit of a 95 percent reduction in
waste associated with this category of medications. We ensure that
patients who need compounds can access them; and where clinically
appropriate, we ensure that patients who do not need these compounds can
receive effective, more affordable alternatives."
Additional Key Findings
● Drugmaker consolidation and drug shortages also
led to increases in traditional drug trend, which rose to 6.4 percent in
● Diabetes remains the leading traditional
therapy class for a fourth straight year based on total costs; Express
Scripts expects double-digit increases in spend in this class over the
next three years due to once-weekly oral and injectable drugs in the
● Cost for medications to treat pain increased
15.7 percent in 2014, due in part to new tamper-resistant formulations
● Inflammatory conditions, which include
treatments for rheumatoid arthritis and psoriasis, maintained their
position as the costliest specialty drug class due to expanded
indications and increased prevalence of treatment.
The full report
is available online at
About Express Scripts
Express Scripts manages more than a billion prescriptions each year
for tens of millions of patients. Headquartered in
St. Louis, Express Scripts provides
integrated pharmacy-benefit management services, including
network-pharmacy claims processing, home delivery, specialty benefit
management, benefit-design consultation, drug-utilization review,
formulary management, and medical and drug data analysis services. The
company also distributes a full range of biopharmaceutical products and
provides extensive cost-management and patient-care services.
For more information, see 2014 Express Scripts
ESRX) Drug Trend Report
at Lab.Express-Scripts.com or follow @ExpressScripts on Twitter.