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Prescription Drug Costs Rose Faster Than Ever for Many Americans: Report

Ed Silverman

May 13, 2015

The prices for new hepatitis C and cancer treatments are driving the cost of prescription drugs to new highs for more Americans, according to a new report.

Specifically, the estimated number of people in the U.S. who took medicines worth more than $50,000 annually rose 63% last year, to 576,000, up from 352,000 the year before. And the number of Americans who are estimated to be taking at least $100,000 worth of drugs jumped 193% to 139,000 people, from 47,000.

Not surprisingly, many of these people are often among the sickest. Among those whose drug costs were at least $100,000, more than one-third were treated for at least 10 different ailments and more than 60% were taking at least 10 different prescription medicines, according to Express Scripts , the nation's largest pharmacy benefits manager, which issued the report.

"The bottom line is that the number of people with very high prescriptions is increasing very rapidly," says Glen Stettin, senior vice president for clinical research at the benefits manager, which reviewed data for 31.5 million people covered by commercial insurers, Medicare and Medicaid. "And a lot of people are being treated with expensive, life-long drugs and so they will be in this category for a long time."

The findings come amid a contentious national debate over prescription drug costs and ways to clamp down on rising prices for some medicines. Much of the focus has been on new treatments for hepatitis C and cancer, although prices have also been rising for some generic drugs, which are typically thought of as lower-cost alternatives.

The report found that nine of 10 patients with drug costs of $50,000 or more used specialty drugs. Among Americans with annual costs of $100,000 or more, 32% used a cancer medication. And the number of patients in the highest-cost categories receiving medication treatment for hepatitis C jumped 733% in 2014, according to the report.

Stettin cited these drugs as "key drivers" behind the increased expenditures. The benefits manager has been a vocal critic of rising prices and recently made a point of saying it would target cancer drugs for the sort of discounts extracted from Gilead Sciences and AbbVie, which sell hepatitis C drugs. A Gilead spokeswoman declined comment and AbbVie did not respond to a request for comment.

Meanwhile, the benefits manager says that health plans are footing the bill as more patients reach their out-of-pocket maximums. For patients whose 2014 drug costs were $100,000 or more last year, health plans paid an average of 98% of the total expense. The value of medicines covered by health plans averaged $156,911, according to the report.

In contrast, insured patients with less than $1,000 of annual drug costs were responsible, on average, for 35% of the total amount of their spending on prescription drugs. Overall, Express Scripts found that patients last year paid an average of 13.5% of their total medication costs, down from 14.9% in 2013.

The report also fingered compounded medicines as another contributing factor to rising spending. Among Americans with annual drug costs of $100,000 or more, the proportion of patients using compounded meds grew 30% in 2014, and the costs for those medicines quadrupled, according to the report. Express Scripts contends these drugs "add little or no value to patient outcomes" and, in some cases, may increase health risks.

We asked the International Academy of Compounding Pharmacists for comment and will pass along any reply. Citing rising costs and allegedly unnecessary use, Express Scripts last year began blocking coverage for approximately 1,000 active ingredients used to make a variety of compounded medicines. A few compounding pharmacies subsequently filed a lawsuit claiming that prescriptions were illegally blocked.


The Wall Street Journal

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