Diabetes Drugs Emerge as Top Force in Drug Spending Growth
- Generics Lead to Plunge in Cholesterol Drug Spending Despite
Higher Use -
FRANKLIN LAKES, N.J., May 15, 2008 /PRNewswire-FirstCall/ –
Diabetes treatments are now the leading driver of prescription drug
spending growth, displacing lipid-lowering drugs which fell
precipitously after a decade of reigning in the top position, as
generic drugs cut the cost of treating high cholesterol. These new
findings were reported by Medco Health Solutions Inc. , the
nation’s leading pharmacy benefit manager, in its just-released
2008 Drug Trend Report, a comprehensive analysis of prescription
drug spending and utilization.
The report shows that despite continued growth in the use of
cholesterol drugs, spending fell 8.5 percent in 2007 as usage of
lower-cost generic versions of Pravachol and Zocor expanded in the
marketplace, resulting in lipid-lowering medications experiencing
the greatest spending decline of all drug categories. Meanwhile,
spending on diabetes drugs increased 12 percent due to shifts
toward higher-cost treatments, brand-name drug price inflation, and
moderate growth in the number of patients receiving treatment.
For a decade, cholesterol drugs were the largest driver of drug
trend — a measure of spending growth for pharmacy benefit plans.
These medications still account for a sizable 10.8 percent of all
prescription costs with utilization rising 5.9 percent last year as
new clinical guidelines expanded the population that can benefit
from these treatments.
“Generic drugs have been a tremendous asset in controlling
runaway health care costs,” Medco Chairman and CEO David B. Snow
Jr. said. “Generic cholesterol medications have helped contain our
drug trend to a new all-time low of 2.0 percent. Patients and our
clients are reaping the benefits of generics as we enable them to
hold down costs and make prescription drugs one of the few areas
where spending trails overall health care inflation.”
Diabetes patients move away from older treatments
While utilization of diabetes medications only increased a
moderate 2.3 percent during 2007, the cost of diabetes treatments
rose sharply as patients shifted to newer drugs. These recently
introduced medications have advantages over older drugs since they
are faster-acting and can help patients better maintain consistent
blood sugar levels to prevent complications from the disease. A
sharp drop in Avandia use due to safety concerns, withdrawal of an
inhalable form of insulin, and declining unit costs for many
generic versions of diabetes drugs were not enough to offset the
trend toward higher-cost treatments.
“The diabetes epidemic and the introduction of new products are
reshaping prescription spending patterns,” said Medco Chief Medical
Officer Dr. Robert S. Epstein. “The number of people diagnosed with
diabetes is increasing by about a million patients per year –
meaning more people need complex drug therapies to control their
blood sugar. While medications are critical for controlling the
disease, many of these cases could have been prevented or delayed
with lifestyle changes, such as diet or exercise.”
Two- or three-drug combinations are frequently being used to
reduce the complications associated with diabetes, which affects
about 21 million Americans. However, only 7 percent of patients
with the disorder achieve target goals for blood glucose,
cholesterol and blood pressure.
Reflecting the need for advanced pharmacy care, the Medco
Therapeutic Resource Centers(R) (TRCs) with more than 1,100
specialist pharmacists, were developed to help patients with
diabetes and other chronic and complex conditions. Specialist
pharmacists help address prescription safety, medication
compliance, and side effects, and engage patients and physicians
about other elements of care. Specialist pharmacists help patients
with diabetes manage their complex drug regimens and supply needs,
as well as the monitoring of the disease itself. The Medco Diabetes
Resource Center was a finalist in URAC’s Best Practices in Consumer
Empowerment and Protection for its initiatives to show how
specialist pharmacists can improve patient safety in the dispensing
of supplies for diabetes patients.
Specialty drug trend decelerates
Medco’s 2008 Drug Trend Report also reveals that specialty drug
spending continues to grow rapidly, but at a slowing rate. Spending
rose 12.3 percent in 2007, with specialty drugs accounting for 11.4
percent of all pharmacy plan spending, an increase from 10.4
percent last year. Autoimmune conditions, cancer, multiple
sclerosis and respiratory conditions were key drivers of specialty
drug trend. Declines in spending for anemia and hepatitis C
treatments helped mitigate some of the growth.
“Specialty drugs, which span many categories of treatments, were
the largest contributor to drug trend last year,” Epstein said.
“These high-cost treatments can be life-changing for people with
complex conditions and highlight the important innovations coming
from the biotech industry. However, the use of these drugs needs to
be managed so people gain the full benefit of treatment in a
cost-efficient way.”
The overall rate of specialty drug trend has slowed in recent
years. In 2006, Medco reported a 16.1 percent growth rate and as
recently as 2003, the rate was 26.6 percent. However, cancer
treatments are expected to continue rapid spending growth, driven
by increased use of costly targeted therapies. Spending for
oncology agents is expected to increase 46 to 53 percent through
2010 on a compounded basis, driven by treatment regimens with
monthly costs that can exceed $10,000.
Specialty drug utilization increased 3.9 percent in 2007. This
increase stemmed from the introduction of new specialty
medications, new indications for drugs currently on the market, and
a wider use of multiple-drug therapy for some conditions. A portion
of the utilization growth reflects client efforts to shift some
specialty drug coverage to the pharmacy benefit rather than under
major medical insurance, a move that can help control costs.
Drug safety concerns cause declines
Health risks from prescription drugs had a significant bearing
on spending and utilization on antidepressants, hormone replacement
therapy and specialty anemia treatments:
* Safety warnings on Procrit(R), Epogen(R) and Aranesp(R) — a group of
drugs designed to improve red blood cell counts — have led to a 15.1
percent drop in spending in this category. These drugs are often used
to treat anemia in patients with cancer or kidney disease, but a study
showed these drugs may be detrimental in many patients with these
conditions;
* An 8.4 percent decrease in spending on antidepressants reflects a
decline in unit costs with generic versions of Zoloft(R) and Wellbutrin
XL(R) entering the market. The use of antidepressants increased slowly
during 2007, which may continue to reflect concerns about the possible
risk of suicidality in children and young adults that surfaced in 2005
with Food and Drug Administration (FDA) warnings;
* Use of hormone replacement therapy (HRT) has been on the decline over
the past six years over health risk concerns, and it fell an additional
9.2 percent in 2007. The Women’s Health Initiative first reported
increased risk of heart attack and stroke in 2002.
About Medco
Medco Health Solutions, Inc., is the nation’s leading pharmacy
benefit manager based on its 2007 total net revenues of more than
$44 billion. Medco’s prescription drug benefit programs, covering
one-in-five Americans, are designed to drive down the cost of
pharmacy health care for private and public employers, health
plans, labor unions and government agencies of all sizes, and for
individuals served by the Medicare Part D Prescription Drug
Program. Medco, the world’s most advanced pharmacy(TM), is
positioned to serve the unique needs of patients with chronic and
complex conditions through its Medco Therapeutic Resource
Centers(R); its diabetes pharmacy care practice, Liberty Medical;
and its specialty pharmacy operation, Accredo Health Group, Inc.
Medco is the highest-ranked independent pharmacy benefit manager on
the 2007 Fortune 500 list. On the Net: http://www.medco.com .
This press release contains “forward-looking statements” as that
term is defined in the Private Securities Litigation Reform Act of
1995. These statements involve risks and uncertainties that may
cause results to differ materially from those set forth in the
statements. No forward-looking statement can be guaranteed, and
actual results may differ materially from those projected. We
undertake no obligation to publicly update any forward- looking
statement, whether as a result of new information, future events,
or otherwise. Forward-looking statements in this press release
should be evaluated together with the risks and uncertainties that
affect our business, particularly those mentioned in the Risk
Factors section of the Company’s Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q filed with the Securities and
Exchange Commission.
CONTACT: Ann Smith of Medco Health Solutions, Inc.,
1-201-269-5984,; or Janet Schiller or Bill Borden, both of Coyne
PublicRelations, 1-973-316-1665, for Medco Health Solutions Inc.
ann_smith@medco. lorazepam. com
Web site: http://www.medco.com/
Ticker Symbol: (NYSE:MHS)
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