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Increase in U.S. Drug Spending Slowed to 5.2 Percent in 2015 Through Cost-Saving Solutions, Specialized Care

- Express Scripts solutions slowed increases in overall drug spending despite price inflation of greater than 20 percent on more than one-third of brand-name medications in 2015

- For Express Scripts members, average monthly copayments decreased 3.2 percent

- Change in drug spending was flat or negative for 30 percent of Express Scripts clients in 2015

- Express Scripts Hepatitis Cure Value Program® lowered the cost of therapy by 50 percent, saving payers $1 billion while providing curative treatment to nearly 50,000 patients

- Drug Trend Report debuts first year-over-year analysis for Health Exchange Population; shows higher utilization is a key driver of increasing spend in this population


News provided by

Express Scripts

Mar 14, 2016, 08:00 ET

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Express Scripts, St. Louis, Missouri.
Express Scripts, St. Louis, Missouri.

ST. LOUIS, March 14, 2016 /PRNewswire/ -- Express Scripts (NASDAQ: ESRX) effectively held the 2015 growth rate in prescription drug spending to just 5.2 percent – roughly half the increase seen in 2014  ̶  through greater client adoption of its innovative solutions and specialized pharmacy care for patients, according to the 20th edition of its annual Drug Trend Report.

Express Scripts clients implementing four or more cost-saving solutions, on average, held their 2015 increase in drug spend to 3.3 percent – nearly two percentage points lower than the national average. If all plan sponsors across the country had adopted similar management strategies, the United States would have spent $6 billion less on prescription drugs last year, while maintaining a clinically sound and affordable pharmacy benefit for American patients.

Furthermore, drug spending was held flat or even decreased in 2015 for 30 percent of Express Scripts clients. In addition, while many plans around the country have been shifting more costs to patients via higher deductibles and copayments, Express Scripts members' out-of-pocket expenses per monthly prescription decreased on average by 3.2 percent last year.

"Standing with payers and patients, Express Scripts controlled costs, expanded access and improved care through the use of our cost-saving, clinically focused solutions," said Glen Stettin, M.D., Chief Innovation Officer at Express Scripts. "Our clients collaborated with us to confront significant challenges to affordable care in 2015 – including a record number of newly approved, high-cost therapies and new drivers of spend and waste – to maintain an affordable benefit for patients. In addition, our pioneering efforts to protect clients from brand inflation are mitigating the effect of drug price hikes on patients and their plans."

Express Scripts' exclusive Prescription Price Index shows rapid inflation in the price of medications, with the average price of brand name drugs increasing 16.2 percent in 2015 and 98.2 percent since 2011. One-third of branded products experienced 2015 price increases greater than 20 percent.

"At a time when drug prices are rising at an unprecedented rate, Express Scripts is making bold moves to keep costs in check and address this issue," said Steve Marciniak, RPh, Vice President, Pharmacy Programs, Priority Health. "Priority Health adopted the Inflation Protection Program to combat unsustainable pricing practices, so we can continue offering our members access to affordable, high-quality care."

Express Scripts' Inflation Protection Program – a new component of the Express Scripts SafeGuardRxSM program – offers budget predictability by holding inflation to levels significantly below the industry average.

Improving Patient Care While Decreasing Spend

Hepatitis C treatment was a leading driver of record drug spending in 2014. However, payers enrolled in Express Scripts' Hepatitis Cure Value Program® effectively addressed the challenge of providing curative therapy to all hepatitis C patients, not just those with the most severely damaged livers. In 2015, these payers lowered the cost of curative therapy by 50 percent, saving $1 billion while providing treatment to nearly 50,000 patients. In addition, our Accredo specialty pharmacy delivered industry leading persistency rates for Viekira Pak® (ombitasvir/paritaprevir/ritonavir; dasabuvir) and Harvoni® (ledipasvir/sofosbuvir) of 93 to 94 percent, compared to 83 to 92 percent at other retail and specialty pharmacies.  

Payers also effectively mitigated the dramatic increases in spending on compounded medications that occurred in 2014, achieving a 97 percent drop in total plan costs for this class in 2015 through Express Scripts' compound management solution.

Strength of Practicing Pharmacy Smarter

Plans that leverage competition among similar drugs in the same therapy class through our National Preferred Formulary (NPF) are keeping down costs while maintain quality. Clients who implement our NPF in 2016 will save $1.3 billion; for clients enrolled since 2014, cumulative savings will total $3 billion.

Leveraging competition to maximize brand rebates also helped payers control spending. Drug manufacturer rebates increased in 2015, contributing to a 2.7 percentage point decrease in 2015 drug trend. 

Overcoming Key Challenges to Affordable Pharmacy Care

Specialty medications – high-cost therapies for the treatment of complex conditions such as rheumatoid arthritis and cancer – remain a key contributor to drug spending for payers, accounting for more than 37 percent of drug spend in 2015, and forecast to reach 50 percent by 2018. Spending on specialty medications increased 17.8 percent in 2015.

Among drivers of specialty pharmacy spend were unit cost increases greater than 17 percent for Enbrel® (etanercept) and Humira® Pen (adalimumab), which contributed significantly to the 25 percent spending increase for the inflammatory conditions medication class.

Biosimilars, or non-brand alternatives, for two of the top three drugs in this class – Remicade® (infliximab) and Humira – may reach the U.S. market in 2017. In addition, their approvals for use in multiple indications provide opportunities for payers to consider indication-based reimbursement to help control their impact on pharmacy budgets.

Among non-specialty therapy classes, diabetes was the most expensive, with an overall increase in spending of 14 percent, driven equally by increases in utilization and unit cost. Lantus® (insulin glargine), the preferred insulin on our NPF, had a 13.7 percent decrease in unit cost. However, high costs for pre-filled insulin pens and newer, expensive therapies continue to drive spend in the category.  

"Drugmaker consolidation, price hikes ahead of impending patent expirations and hyperinflation on older medications without therapy class competition all contributed significantly to increased drug spending," said Stettin. "Fortunately, payers who closely manage their benefit soon can leverage the generic availability of specialty medications like Gleevec® (imatinib) – which experienced a 3-fold price increase over the past 10 years before it lost patent protection last month – and also tap into the potential $39.7 billion in savings from biosimilars over the next five years."

Total drug spending is forecast to increase between six and eight percent annually between 2016 and 2018, net of rebates. Specialty spending, led by inflammatory conditions and new discoveries for cancer, is forecast to increase an average of 17 percent annually over the next three years.

Health Exchange Insights

With two years of Health Insurance Exchange data available, the Express Scripts Drug Trend Report now includes analysis of prescription drug use and spending for this nascent population.

While overall 2015 per-member-per-year (PMPY) spend for traditional and specialty medications was less than the commercially insured population, the overall increase in spending between 2014 and 2015 for the exchange population was 14.6 percent, higher than the trends among commercial, Medicare and Medicaid populations.

An 8.6 percent increase in overall prescription utilization was the primary driver for the spending increase, a trend that may be due to patients in this population fulfilling a prior unmet need, and newly insured beneficiaries fully using their new prescription drug benefit.

"Based on our earlier analyses, we expected a higher overall trend driven significantly by utilization growth in this population.  Many members, previously uninsured or underinsured, were newly diagnosed with chronic conditions, or sought treatment for pre-existing conditions," said Julie Huppert, Vice President of Health Care Reform, Express Scripts. "Trends in this market should settle as benefit usage stabilizes, and plans learn more about their patients and implement additional proven pharmacy management programs."

The 2015 Express Scripts Drug Trend Report offers a comprehensive review of trends in prescription drug spending for commercially insured health plans and self-funded plans, Medicare, Medicaid and Public Health Exchange plans. To access the full report, please visit lab.express-scripts.com.

About Express Scripts

Express Scripts puts medicine within reach of tens of millions of people by aligning with plan sponsors, taking bold action and delivering patient-centered care to make better health more affordable and accessible.

Headquartered in St. Louis, Express Scripts provides integrated pharmacy benefit management services, including network-pharmacy claims processing, home delivery pharmacy care, specialty pharmacy care, specialty benefit management, benefit-design consultation, drug utilization review, formulary management, and medical and drug data analysis services. Express Scripts also distributes a full range of biopharmaceutical products and provides extensive cost-management and patient-care services.

For more information, visit Lab.Express-Scripts.com or follow @ExpressScripts on Twitter.

Express Scripts Media Contact:

Jennifer Luddy  
201-269-6402
[email protected]

Logo - http://photos.prnewswire.com/prnh/20080827/EXPRESSSCRIPTSLOGO

SOURCE Express Scripts

Related Links

http://www.express-scripts.com

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