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Drug costs projected to rise three to five percent in all settings in 2014

Date:
March 5, 2014
Source:
American Society of Health-System Pharmacists (ASHP)
Summary:
Costs for medications are expected to rise by 3 - 5% in all health care settings in 2014, according to a report. This annual projection of drug expenditures helps hospitals and health-systems plan drug budgets, which are a significant operating expense.
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Bethesda, Md. -- Costs for medications are expected to rise by three to five percent in all health care settings in 2014, according to a report published online ahead of print, by the American Journal of Health-System Pharmacy(AJHP), the professional journal of the American Society of Health-System Pharmacists (ASHP). ASHP publishes this annual projection of drug expenditures to help hospitals and health-systems plan drug budgets, which are a significant operating expense.

The report, National Trends in Prescription Drug Expenditures and Projections for 2014, by Glen T. Schumock, Pharm.D., M.B.A, Ph.D., et al, will be published in the March 15, 2014, edition of AJHP and examines recent trends in drug expenditures, projects drug expenditures for 2014, and explores factors likely to influence drug expenditures.

Prescription drugs account for approximately 11 percent of overall U.S. health care expenditures. As with other health care expenditures, growth in prescription drug spending has lessened in recent years, with a 0.7 percent decrease in spending during the 12-month period ending September 30, 2013 compared with 2012. The authors expect a reversal of this trend in 2014, projecting a three to five percent increase in drug expenditures across all settings, a five to seven percent increase in expenditures for clinic-administered drugs, and a one to three percent increase in hospital drug expenditures.

"Our projections for 2014 indicate a clear reversal of the downward growth in prescription drug expenditures we have seen over the last several years," said Schumock. "Drug expenditure trends will remain dynamic, and so health systems will need to carefully monitor local drug use patterns."

These increases in expenditures are influenced by a variety of factors, according to the report, including new drug approvals and patent expirations. Using data provided by IMS Health, the authors report several trends in prescription drug spending, including:

- Clinics and nonfederal hospitals experienced increased drug spending (4.5 percent and 1.8 percent growth, respectively) in 2013 relative to 2012, while decreased expenditures were seen in federal facilities (-13.7 percent) and in long-term care (-4.2 percent), mail order (-1.9 percent) and retail pharmacy (-0.3 percent) sectors.

- Changes in expenditures for specific medications, drug classes, and therapeutic categories. These included:

o A significant decrease in expenditures across all settings for oxycodone.

o A significant increase in expenditures for influenza vaccines in the clinic setting, which may be due to new vaccine formulations and vaccination recommendations.

o A decrease in the expenditure growth rate for anti-cancer drugs (from 2012 to 2013), although anti-cancer drugs remain the top expenditure for hospitals and clinics.

o Changes in the availability of generic products, with fewer first-time generic drugs expected to reach the market in 2014.


Story Source:

The above story is based on materials provided by American Society of Health-System Pharmacists (ASHP). Note: Materials may be edited for content and length.


Journal Reference:

  1. G. T. Schumock, E. C. Li, K. J. Suda, L. M. Matusiak, R. J. Hunkler, L. C. Vermeulen, J. M. Hoffman. National trends in prescription drug expenditures and projections for 2014. American Journal of Health-System Pharmacy, 2014; 71 (6): 482 DOI: 10.2146/ajhp130767

Cite This Page:

American Society of Health-System Pharmacists (ASHP). "Drug costs projected to rise three to five percent in all settings in 2014." ScienceDaily. ScienceDaily, 5 March 2014. <www.sciencedaily.com/releases/2014/03/140305144716.htm>.
American Society of Health-System Pharmacists (ASHP). (2014, March 5). Drug costs projected to rise three to five percent in all settings in 2014. ScienceDaily. Retrieved May 30, 2015 from www.sciencedaily.com/releases/2014/03/140305144716.htm
American Society of Health-System Pharmacists (ASHP). "Drug costs projected to rise three to five percent in all settings in 2014." ScienceDaily. www.sciencedaily.com/releases/2014/03/140305144716.htm (accessed May 30, 2015).

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