Expensive new cancer drugs, treating increasing numbers of patients, could drive up cancer drug spending by as much as 15% a year through 2013, according to the newly released 2011 Medco Drug Trend Report, which tracks drug utilization and spending.
At this accelerated rate, oncology drugs will likely rise to the second or third largest trend-driving category by 2015, following diabetes and central nervous system treatments.
Although the incidence of some types of cancers may be decreasing, the overall numbers of cancers reported in an aging population has increased significantly with better detection. Due to advanced treatment, the number of U.S. cancer survivors is expected to increase by more than 30% by 2020.
Oncology drugs are expected to become the No. 2 or No. 3 highest cost driver by therapeutic class by 2015, predicts Medco.
This year’s top cost drivers by therapeutic class include diabetes (No. 1), respiratory drugs (No. 2), rheumatological drugs (No. 3) and neuroscience drugs (No. 4).
An increase in small-molecule branded drugs, coupled with many generics coming out, has the potential to “create negative drug trend for our customers,” said David Snow, chairman and CEO of Medco Health Solutions. However, he added, new innovation in and inflation of biotech drugs could likely overcome any savings realized from the small-molecule and generic side.
Higher generic drug dispensing helped limit prescription drug spending growth to 3.7% in 2010. More than 71% of prescription drugs dispensed in 2010 were generics.
Specialty drugs, which are largely brand-name biologics, accounted for 70.1% of the overall drug trend. Both utilization and unit costs grew for these medicines, which treat rheumatoid arthritis, multiple sclerosis, cancer and an array of other conditions.
For the fourth consecutive year, diabetes medications were the largest therapeutic category of drugs for driving overall spending growth. The large number of patients with diabetes led this category to contribute nearly 17% of the overall growth in drug spending last year. Unit costs for these drugs increased 5%, while utilization increased 2.5%.
“There’s been an astronomical growth in chronic and complex disease,” said Snow. “It’s driven largely by the aging of America, but also by lifestyle choices. It’s imperative that private-sector payers implement strategies to mitigate costs.”
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