Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines Costs in Context - June 2019PhRMA
We are in a new era of medicine where breakthrough science is transforming care with innovative treatment approaches and enabling us to more effectively treat chronic disease, the biggest cost driver.
Prescription Medicines - Costs in Context January 2019PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines - Costs in Context - August 2018PhRMA
Discussions about the cost and affordability of medicines – and health care more broadly – are important. At the same time, it is important to look at costs across the health care system and not just the share going toward life changing medicines.
Prescription Medicines - Costs In Context March 2019PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines - Costs in Context - October 2018PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines Costs in Context - June 2019PhRMA
We are in a new era of medicine where breakthrough science is transforming care with innovative treatment approaches and enabling us to more effectively treat chronic disease, the biggest cost driver.
Prescription Medicines - Costs in Context January 2019PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines - Costs in Context - August 2018PhRMA
Discussions about the cost and affordability of medicines – and health care more broadly – are important. At the same time, it is important to look at costs across the health care system and not just the share going toward life changing medicines.
Prescription Medicines - Costs In Context March 2019PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines - Costs in Context - October 2018PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Is European market access becoming an incubator for rare disease development?...KateBenson18
FIECON's white paper 'Is European market access becoming an incubator for rare disease development?' explores the hypothesis that successful commercialisation in Europe is the biggest commercial opportunity for orphan drug manufacturers right now.
Listeners participated in a live panel session addressing OHIP+, the recently announced expansion of the Ontario drug program to cover young people who are younger than 25 years-old.
This webinar will introduce you to the Patented Medicine Prices Review Board (PMPRB), how they regulate drug pricing in Canada and the proposed changes that will affect cancer patients.
The intensifying global focus on oncology reflects its increasing impact on patients and expanding share of healthcare expenditure. Relative to other parts of the healthcare system, oncology brings high levels of uncertainty—in terms of the nature and rate of innovative treatments, the willingness by payers to reimburse care at current levels, and the shifting composition of the cancer patient population from mature and developed markets to low- and middle-income countries. As the sales of cancer treatments rise to $100 billion annually, more intensive scrutiny of this market can be expected and a deeper understanding of global oncology trends will be required by all stakeholders.
CAPCA wants to make sure that patients have access to innovative and effective cancer treatments, and Heather Logan, ED of CAPCA, will explain how CAPCA is going to do this and answer your questions about the process. This webinar will introduce you to CAPCA and its mandate and to the new pan-Canadian Cancer Drug Funding Sustainability Initiative (DFSI). The goal of DFSI is to ensure that patients continue to have access to innovative and effective cancer treatments, and that the cancer system is achieving maximum value for money invested.
Is European market access becoming an incubator for rare disease development?...KateBenson18
FIECON's white paper 'Is European market access becoming an incubator for rare disease development?' explores the hypothesis that successful commercialisation in Europe is the biggest commercial opportunity for orphan drug manufacturers right now.
Listeners participated in a live panel session addressing OHIP+, the recently announced expansion of the Ontario drug program to cover young people who are younger than 25 years-old.
This webinar will introduce you to the Patented Medicine Prices Review Board (PMPRB), how they regulate drug pricing in Canada and the proposed changes that will affect cancer patients.
The intensifying global focus on oncology reflects its increasing impact on patients and expanding share of healthcare expenditure. Relative to other parts of the healthcare system, oncology brings high levels of uncertainty—in terms of the nature and rate of innovative treatments, the willingness by payers to reimburse care at current levels, and the shifting composition of the cancer patient population from mature and developed markets to low- and middle-income countries. As the sales of cancer treatments rise to $100 billion annually, more intensive scrutiny of this market can be expected and a deeper understanding of global oncology trends will be required by all stakeholders.
CAPCA wants to make sure that patients have access to innovative and effective cancer treatments, and Heather Logan, ED of CAPCA, will explain how CAPCA is going to do this and answer your questions about the process. This webinar will introduce you to CAPCA and its mandate and to the new pan-Canadian Cancer Drug Funding Sustainability Initiative (DFSI). The goal of DFSI is to ensure that patients continue to have access to innovative and effective cancer treatments, and that the cancer system is achieving maximum value for money invested.
Third-party administrators (TPAs), employers and employees are increasingly concerned about the growing cost of specialty drugs. Relief, WellDyneRx believes, will come to those employers and TPAs that (1) encourage specific public policy changes and (2) partner with pharmacy benefit managers (PBMs) that own best-of-breed specialty pharmacies.
A new study adds further evidence to suggest that opioid prescribing in the U.S. is skewed and concentrated among a few providers. Researchers looked at prescribing patterns in data from an unspecified national private insurer between 2003-2017.
Around 670,000 providers prescribed more than 8 million standard doses of opioid prescriptions — but more than a quarter of these prescriptions were written by only 1% of physicians. And in 2017, these physicians prescribed nearly half of all the dispensed opioids. This small group of doctors also prescribed higher doses than recommended, and for longer durations than guidelines allow.
What’s encouraging, the authors suggest, is that the vast majority of physicians do seem to follow guidelines. Some caveats: The study was based on one company’s data, and didn’t look at medical reasons behind prescriptions.
Medicines Use and Spending Shifts: A Review of the Use of MedicinesIMS Health US
Growth in spending on medicines was higher in 2014 than any year since 2001, and
exceeded forecast overall healthcare spending growth for the first time since 2011.
As 2014 was also a landmark year in the implementation of the Affordable Care Act,
understanding the specific drivers of medicine spending growth is important for decisionmakers
across the healthcare system.
In this report we bring together several perspectives on 2014: total system spending on
medicines at an aggregate and segmented level; the evolution of healthcare demand, delivery
and payment systems; patient out-of-pocket costs for medical and pharmacy benefits including
retail prescription co-pays; and transformations in disease treatment resulting from newly
approved medicines.
Government cost containment methods in Asia-Pacific markets are as diverse as the cultures represented in the region, so what lessons are the markets leveraging from cost containment experiences? And what, in the end, are pharmaceutical companies supposed to do about it?
Ethical dilemmas concerning drug pricing-Shrinath GhadgeShrinath Ghadge
There is no straightforward solution to the proper pricing of a pharmaceutical. Numerous factors influence pricing from the company perspective such as return on investment, costs of future R&D efforts, access to federal funding, and size of the patient population, to name a few. In addition the healthcare system in the US is generally much more expensive than other countries, driving up overall costs. A public distrust of pharmaceutical companies' greed has been fueled by recent cases of exorbitant increases in drug prices without clear cause. These instances do raise questions of the ethics employed by some companies
Prescription Medicines - Insulin Costs in ContextPhRMA
A century ago, patients were treated with animal insulins. Today, biopharmaceutical companies produce insulins that operate at the molecular level, more closely resembling insulin released naturally in the body and more effectively managing the disease. The options available today also help meet a wide range of unmet needs, providing patients with the tools necessary to stay adherent and healthy – saving costs throughout the health care system. However, this innovation isn’t enough if patients can’t afford their insulin and other medicines at the pharmacy.
Prescription Medicines - Costs in Context - September 2018PhRMA
Discussions about costs are important. We recognize that many are struggling to access the medicine they need, and have important questions about their medicine costs. And we want to help find the answers.
Prescription Medicines: International Costs in ContextPhRMA
Our new Prescription Medicines: International Costs in Context explains how medicines benefit patients, health care systems, and the global economy. Advances in treatment are tacking some of the world’s greatest public health challenges. These treatments provide critical savings for health care systems by reducing the need for more costly services. What’s more is the profound impact that biopharmaceutical companies have on the global economy, including the creation of high-skill jobs, R&D investment, and medicines that improve worker productivity.
2016 Report: Medicines in Development for Alzheimer's DiseasePhRMA
Today, more than 5 million Americans have Alzheimer’s disease. The disease devastates the minds of patients, creates substantial burdens for families and caregivers, and currently costs the health care system more than $200 billion a year. These sobering statistics are projected to get much worse as the 76 million American baby boomers age.
This report shows that America's Biopharmaceutical Research Companies Are Developing More Than 70 Medicines for Alzheimer’s Disease
2015 Report: Medicines in Development for Heart Disease & StrokePhRMA
According to the American Heart Association, someone in the United States dies from cardiovascular disease every 40 seconds, and more than 85 million Americans have at least one form of the disease. Heart disease has been the leading cause of death in the United States since 1921, but these numbers are declining. Read this report by PhRMA - in partnership with the Association of Black Cardiologists - on the nearly 200 medicines in development for heart disease & stroke.
R3 Stem Cells and Kidney Repair A New Horizon in Nephrology.pptxR3 Stem Cell
R3 Stem Cells and Kidney Repair: A New Horizon in Nephrology" explores groundbreaking advancements in the use of R3 stem cells for kidney disease treatment. This insightful piece delves into the potential of these cells to regenerate damaged kidney tissue, offering new hope for patients and reshaping the future of nephrology.
Medical Technology Tackles New Health Care Demand - Research Report - March 2...pchutichetpong
M Capital Group (“MCG”) predicts that with, against, despite, and even without the global pandemic, the medical technology (MedTech) industry shows signs of continuous healthy growth, driven by smaller, faster, and cheaper devices, growing demand for home-based applications, technological innovation, strategic acquisitions, investments, and SPAC listings. MCG predicts that this should reflects itself in annual growth of over 6%, well beyond 2028.
According to Chris Mouchabhani, Managing Partner at M Capital Group, “Despite all economic scenarios that one may consider, beyond overall economic shocks, medical technology should remain one of the most promising and robust sectors over the short to medium term and well beyond 2028.”
There is a movement towards home-based care for the elderly, next generation scanning and MRI devices, wearable technology, artificial intelligence incorporation, and online connectivity. Experts also see a focus on predictive, preventive, personalized, participatory, and precision medicine, with rising levels of integration of home care and technological innovation.
The average cost of treatment has been rising across the board, creating additional financial burdens to governments, healthcare providers and insurance companies. According to MCG, cost-per-inpatient-stay in the United States alone rose on average annually by over 13% between 2014 to 2021, leading MedTech to focus research efforts on optimized medical equipment at lower price points, whilst emphasizing portability and ease of use. Namely, 46% of the 1,008 medical technology companies in the 2021 MedTech Innovator (“MTI”) database are focusing on prevention, wellness, detection, or diagnosis, signaling a clear push for preventive care to also tackle costs.
In addition, there has also been a lasting impact on consumer and medical demand for home care, supported by the pandemic. Lockdowns, closure of care facilities, and healthcare systems subjected to capacity pressure, accelerated demand away from traditional inpatient care. Now, outpatient care solutions are driving industry production, with nearly 70% of recent diagnostics start-up companies producing products in areas such as ambulatory clinics, at-home care, and self-administered diagnostics.
Empowering ACOs: Leveraging Quality Management Tools for MIPS and BeyondHealth Catalyst
Join us as we delve into the crucial realm of quality reporting for MSSP (Medicare Shared Savings Program) Accountable Care Organizations (ACOs).
In this session, we will explore how a robust quality management solution can empower your organization to meet regulatory requirements and improve processes for MIPS reporting and internal quality programs. Learn how our MeasureAble application enables compliance and fosters continuous improvement.
The dimensions of healthcare quality refer to various attributes or aspects that define the standard of healthcare services. These dimensions are used to evaluate, measure, and improve the quality of care provided to patients. A comprehensive understanding of these dimensions ensures that healthcare systems can address various aspects of patient care effectively and holistically. Dimensions of Healthcare Quality and Performance of care include the following; Appropriateness, Availability, Competence, Continuity, Effectiveness, Efficiency, Efficacy, Prevention, Respect and Care, Safety as well as Timeliness.
Telehealth Psychology Building Trust with Clients.pptxThe Harvest Clinic
Telehealth psychology is a digital approach that offers psychological services and mental health care to clients remotely, using technologies like video conferencing, phone calls, text messaging, and mobile apps for communication.
Deep Leg Vein Thrombosis (DVT): Meaning, Causes, Symptoms, Treatment, and Mor...The Lifesciences Magazine
Deep Leg Vein Thrombosis occurs when a blood clot forms in one or more of the deep veins in the legs. These clots can impede blood flow, leading to severe complications.
One of the most developed cities of India, the city of Chennai is the capital of Tamilnadu and many people from different parts of India come here to earn their bread and butter. Being a metropolitan, the city is filled with towering building and beaches but the sad part as with almost every Indian city
Explore our infographic on 'Essential Metrics for Palliative Care Management' which highlights key performance indicators crucial for enhancing the quality and efficiency of palliative care services.
This visual guide breaks down important metrics across four categories: Patient-Centered Metrics, Care Efficiency Metrics, Quality of Life Metrics, and Staff Metrics. Each section is designed to help healthcare professionals monitor and improve care delivery for patients facing serious illnesses. Understand how to implement these metrics in your palliative care practices for better outcomes and higher satisfaction levels.
2. 2
Then Now
We are in a new era of medicine where breakthrough science
is transforming care with innovative treatment approaches...
Medicines made of chemical
compounds
Medicines treat broad diseases
Radiation and chemotherapy to
treat cancer
Medicines made from living cells
Medicines targeted to specific
patient based on genetic makeup
Immunotherapy that harnesses
body’s own immune system to
fight disease
CAR T-cell therapy
CRISPR
Prescription Medicines: Costs in Context www.phrma.org/cost
3. 3
Treating people with one or more chronic condition consumes
90 cents of every dollar spent on health care.
…and enabling us to more effectively treat chronic disease,
the biggest cost driver.
Prescription Medicines: Costs in Context www.phrma.org/cost
Prevalence and Spending by Number of Chronic Conditions (2014)
PERCENTAGE
Total
population
Total
expenditures
12%
41%16%
26%
31%
23%
10%
40%
Number of
chronic conditions
5+
3 – 4
1 – 2
0
Note: Total health care spending defined as the amount
spent on all outpatient and inpatient health care
services across all payers, including out of-pocket
payments.
Health Care Spending by Number of Chronic Conditions (2014)
AVERAGEANNUALSPENDINGPERPERSONINDOLLARS
Number of Chronic Conditions
Note: Total health care spending
is defined as the amount spent on
health care services across all
payers, including patient out-of-
pocket payments.
Other
Home health
Prescription
ED
Office and outpatient
Inpatient
Source: RAND Corporation
4. 4
In the midst of this incredible progress, medicine cost
growth is declining.
Prescription Medicines: Costs in Context www.phrma.org/cost
3.8%
1.5%
2016
2017
3.2%
1.9%
2016
2017
3.9%
0.6
2016
2017
Note: IQVIA data is reflective of retail and physician-administered medicine spending.
5. 5
In fact, after discounts and rebates, brand medicine prices
grew just 1.9% in 2017.
Source: IQVIA. Medicines use and spending in the U.S.: a review of 2017 and outlook to 2022. Published April 2018. Accessed April 2018.
*Includes protected brand medicines only (ie, brand medicines without generic versions available in the year indicated).
**Net price growth reflects impact of off-invoice rebates and discounts provided by manufacturers.
Estimated Net Price Growth**Invoice Price Growth
Prescription Medicines: Costs in Context www.phrma.org/cost
6. 6
Spending on retail and physician-administered medicines
continues to represent just 14% of spending…
8%
12%
14%
18%
13%
4%
31%
Admin Costs
Home Health & Nursing Home Care
Prescription Medicines
Physician & Clinical Services
Other**
Dental Services
Hospital Care
U.S. Health
Care
Spending,
2015
Source: PhRMA analysis of CMS National Health Expenditures data, Altarum Institute study and Berkley Research Group study.
**Supply chain entities- stakeholders involved in bringing medicines from manufacturer to patient, including wholesalers, pharmacies, PBMs and healthcare provider locations.
Prescription Medicines: Costs in Context www.phrma.org/cost
7. 7
Dental Services
Other
Prescription Medicines
Government Administrative Costs
Physician and Clinical Services
Home Health and Nursing Home Care
Hospital Care12%
32%
34%
2%
3%
…and a small share of total Medicaid spending…
TOTAL
$545B
Note: Prescription drug data is net of rebates and includes both retail and non-retail drugs. Data used were predominantly derived from CMS 64 reports. Pre-rebate expenditures were tabulated using FY2015 CMS
State Drug Utilization data files and CMS brand/generic indicators for each NDC.
Source: CMS National Health Expenditure Data and Altarum Institute.
Prescription Medicines: Costs in Context www.phrma.org/cost
11%
7%
8. 8
…and is projected to grow in line with health care spending
through next decade.
Note: Total retail sales include brand medicines and generics.
Source: Centers for Medicare & Medicaid Services (CMS).
Prescription Medicines: Costs in Context www.phrma.org/cost
PercentAnnualGrowthRate
Health Care Retail Prescription Medicines
9. 9
At the same time, growth in other health care services will be
5 times total medicine spending growth through next decade.
Source: CMS National Health Expenditures Report, December 2017
Source: Altarum Institute. "Projections of the prescription drug share of national health expenditures including non-retail." May 2018.
Other Health Care Services
(10-year cumulative increase: $1,958 billion)
Total Prescription Drug Expenditures
(10-year cumulative increase: $401 billion)
Prescription Medicines: Costs in Context www.phrma.org/cost
Projected Cumulative Growth in Spending (in millions), 2017–2026
5x
10. 10
Insurers and PBMs have a lot of leverage to hold down
medicine costs.
Negotiating power is increasingly concentrated among
fewer pharmacy benefit managers (PBMs).
Top 3
Market Share:
71%
22%
25%
24%
29%
OptumRx (UnitedHealthGroup)
CVS Health (Caremark)
Express Scripts
All Other
Prescription Medicines: Costs in Context www.phrma.org/cost
Insurers determine:
FORMULARY
if a medicine is covered
TIER PLACEMENT
patient cost sharing
ACCESSIBILITY
utilization management through
prior authorization or fail first
PROVIDER INCENTIVES
preferred treatment guidelines
and pathways
Source: Drug Channels Institute, February 2018.
11. 11
In fact, more than 1/3 of the list price is rebated back to payers,
the government and other stakeholders in the supply chain.
Prescription Medicines: Costs in Context www.phrma.org/cost
Rebates, discounts, fees and other
price concessions have more than
doubled since 2012
Brand companies retain just 63% of list price
spending on medicines
62.6%
18.5%
12%
6.9%
Brand Companies
Market Access Rebates and Discounts
Statutory Rebates and Fees
Supply Chain Entities
Source: Berkeley Research Group. Fein AJ; Drug Channels Institute
2012 2017
$74B
$153B
12. 12
Hospitals also benefit from misaligned incentives in the supply
chain.
An analysis found that 320
hospitals mark up some
medicine prices at least 1000%
Nearly one in five hospitals marks
up medicine prices to 700% or
more of their acquisition cost
If a hospital purchased a medicine
for $150, a 700% markup could
result in patients being billed
$1,050 for that medicine
Amount
paid by
hospital
Amount
billed by
hospital
$1,050
$150
1000%
Source: The Moran Company. Hospital Charges and Reimbursement for Medicines: Analysis of Cost-to Charge Ratios. September 2018.
13. 13
90% of all medicines dispensed in the United States
are generics.
Source: IMS Health.
Source: Generic Pharmaceutical Association, “Generic Drug Savings in the U.S. Report,” 2018.
$1.79
trillion
10-year savings
(2008-2017)
Prescription Medicines: Costs in Context www.phrma.org/cost
90%88%
72%
52%
33%
43%
19%
1984 1990 1996 2002 2008 2014 2017
14. 14
Generics cost a fraction of the price of the initial
brand medicine.
Note: Figures represent the average annual price for 30 pills of the most commonly dispensed form and strength. "Then” price
represents the average price in the year prior to generic entry. “Now” price represents the average price in December 2017.
Source: IQVIA Institute for Human Data Science analysis for PhRMA. May 2018.
-92%
-93%
-98%
-96%
-98%
Prescription Medicines: Costs in Context www.phrma.org/cost
Medicine
DIOVAN VCT®
Hypertension (2010)
LIPITOR®
Cholesterol (2010)
PLAVIX®
Blood Thinner (2011)
SEROQUEL®
Schizophrenia (2010)
ZYPREXA®
Schizophrenia& (2010)
Bipolar Disorder
% Change
Brand Name THEN Generic NOW
$87
$85
$166
$87
$393
$7
$6
$4
$2
$17
15. 15
Competition from generics and biosimilars is expected to
reduce U.S. brand sales by $105 billion from 2018 to 2022.
2013-2017: $74 Billion
Projected
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
2018-2022: $105 Billion
-$17
-$12
-$15 -$14
-$16
-$26
-$19 -$18
-$17
-$26
Source: IQVIA. Medicines use and spending in the U.S.: a review of 2017 and outlook to 2022. Published April 2018. Accessed April 2018.
16. 16
At the same time, innovator companies race to be the first to
market with a new medicine.
Time Between Approval of First and
Second Medicines in a Therapeutic
Class Has Declined Dramatically
Competing brands generally launch within years
10.2
years
1970’s
2.3
years
2005-2011
Prescription Medicines: Costs in Context www.phrma.org/cost
Source: Tufts Center for the Study of Drug Development (CSDD).
17. 17
For example, American patients have access to cancer
medicines about two years earlier.
The competitive U.S. market provides patients with access to
innovative medicines faster.
22
15
10
10
10
10
10
21
17
17
15
13
7
4
0 5 10 15 20 25 30 35 40 45 50
Taiwan
Australia
Spain
Italy
United Kingdom
France
Germany
Months
Delay in cancer medicine approval and reimbursement, 2010-2014
Delay Between U.S. Approval and Country-Specific Approval Delay Between Country Approval and Reimbursement
17
23
25
27
32
43
14
Prescription Medicines: Costs in Context www.phrma.org/cost
Source: PhRMA analysis of IMS Consulting Group “Patient Access to Innovative Oncology Medicines Across Developed Markets.” June 2016
18. 18
Nearly 90% of newly launched medicines from 2011 to 2017 were available in the
United States, compared to just two-thirds in the UK, half in Canada and France,
and one-third in Australia.
More medicines are available to U.S. patients.
Number of New Medicines Available by Country*
(of 220 drugs launched 2011-2017)
Note: New Molecular Entities (NME) approved by the FDA. European Medicines Agency (EMA) and Japan’s Pharmaceuticals and Medical Devices Agency (JPMDA), and launch in any country between 2011-2017
Source: PhRMA analysis of IQVIA Analytics
Prescription Medicines: Costs in Context www.phrma.org/cost
USA Germany UK Japan Canada France South Korea Australia New Zealand China
192
156
147
108 106 106
80
73
32
17
87%
71%
67%
49% 48% 48%
36%
33%
15%
8%
For example, of the 14 new
diabetes medicines
launched over the period,
only one
was available in France.
19. 19
Spending on prescription medicines is a small percentage of
total health care spending around the world.
Note: Total health care spending includes hospital care, physician and clinical services, home health and nursing home care, government administration and net cost of private health insurance, dental, home health and other
professional services as well as durable medical equipment.
Source: OECD Health Statistics Database (accessed February 2016); Altarum Institute, 2015, A ten year projection of the prescription drug share of national health expenditures including non-retail.
Prescription Medicines as a Percentage of Total Health Care Spending
14% Canada
14% USA
11% UK
13% France
13% Germany
15% Italy
12% Spain
16% Japan
10% Australia
16% Korea
Prescription Medicines: Costs in Context www.phrma.org/cost
20. 20
Patients in the United States are facing rising out-of-pocket
costs and other barriers to care.
The use of four or more cost-
sharing tiers is becoming more
common on employer plans
Percent of plans with deductibles
on prescription drugs
23%
52%
2012 2017
Source: PWC, Health and Well-Being Touchstone Survey, various years
Prescription Medicines: Costs in Context www.phrma.org/cost
2004 2006 2008 2010 2012 2014 2015 2016 2017
3%
5%
7%
13%
14%
20%
23%
32%
44%
21. 21
Cost sharing for nearly 1 in 5 brand
prescriptions is based on list price
More than half of commercially insured
patients’ out-of-pocket spending for brand
medicines is based on the full list price
And too often negotiated savings do not make their way
to patients.
Prescription Medicines: Costs in Context www.phrma.org/cost
44%
26%
29%
55%
Copay
Deductible
Coinsurance
Source: IQVIA. May 2018.
22. 22
Certain commercially insured patients could save $145 to more than $800 annually.
Sharing negotiated discounts with patients would increase
premiums about 1%.
NOTE: Plan cost includes medical and pharmacy claims
*HDHP = High-deductible health plan
Prescription Medicines: Costs in Context www.phrma.org/cost
Change in Plan Costs with Shared Rebates
PLAN TYPE
Traditional PPO Copay HDHP* Coinsurance HDHP
Net Plan Per Member Per Month Spend $433.91 $374.41 $372.89
Change in Plan Costs $ $0.82 $2.62 $3.84
Change in Plan Costs % 0.2% 0.7% 1.0%
23. 23
And
20%
of revenues are reinvested
into R&D
NOTE: The remaining 57% share of business R&D spending is conducted by other industries, including subsectors of the machinery sector, the computer and electronics products sector, and the electrical equipment, appliance, and components sector.
Source: Research!America report and PhRMA analysis of National Science Foundation data.
Industry invests 17% of all domestic research
and development funded by U.S. businesses
Invested about
$90 Billion
in R&D in 2016
Prescription Medicines: Costs in Context www.phrma.org/cost
Biopharmaceutical companies use today’s revenues to invest
in tomorrow’s treatments and cures.
Phamaceuticals
& Medicines
Software Automobiles Aerospace Computer
Systems Design
Scientific R&D
Services
24. 24
On average, it takes more than
10 years and $2.6B to research and develop a new medicine.
BETWEEN 1998 AND 2014
Unsuccessful
Attempts
Successful
Attempts
123
Alzheimer’s Disease
96
Melanoma
167
Lung Cancer
4
Alzheimer’s Disease
7
Melanoma
10
Lung Cancer
Just
12%
of drug candidates that enter
clinical testing are approved
for use by patients
Source: Tufts Center for the Study of Drug Development (CSDD).
Source: Pharmaceutical Research and Manufacturers of America (PhRMA), “Researching Alzheimer’s Medicines: Setbacks and Stepping Stones,” 2015.
Source: Pharmaceutical Research and Manufacturers of America (PhRMA), “Researching Cancer Medicines: Setbacks and Stepping Stones,” 2014.
Prescription Medicines: Costs in Context www.phrma.org/cost
We need a public policy environment that recognizes and
rewards risk taking.
25. 25
PROMOTE VALUE-DRIVEN HEALTH CARE
• Remove barriers restricting information companies can share with insurers.
• Reform regulations discouraging companies from offering discounts tied to outcomes.
• Modify Medicaid best price requirements.
MODERNIZE THE DRUG DISCOVERY AND DEVELOPMENT PROCESS
• Modernize the FDA to keep pace with scientific discovery and increase efficiency of generic approvals
• Promote and incentivize generic competition.
EMPOWER CONSUMERS AND LOWER OUT-OF-POCKET COSTS
• Provide patients with access to negotiated rebates.
• Address affordability challenges in the deductible.
• Make more information on health care out-of-pocket costs and quality available to patients.
IMPROVE TRADE AGREEMENTS
• Enforce existing trade agreements.
• Ensure new trade agreements recognize value of innovative medicines.
Prescription Medicines: Costs in Context www.phrma.org/cost
ADDRESS MARKET DISTORTIONS
• Address burdensome regulations that distort programs like the 340B Drug Pricing program.
Collectively, these market-based reforms can make medicines
more affordable and accessible.
Editor's Notes
13. IMS Institute for Healthcare Informatics. March 2017.