Americans have almost doubled spending on specialty drugs from pharmacies, study finds

Maia Anderson -

Between 2010 and 2017, Americans nearly doubled spending on specialty drugs purchased at pharmacies or by mail after accounting for rebates, according to a study cited by STAT

Seven things to know about the study, as reported by STAT

  1. Specialty drugs made up 38 percent of retail and mail-order prescription spending in 2017, up from 20 percent in 2010. Spending tripled for Medicare Part D beneficiaries and more than doubled for those with private insurance, according to the study, which was published in Health Affairs.

  2. The study, which relied on data from the Medical Expenditure Panel Survey, defined specialty drugs as those with a median price of more than $600 for a 30-day supply between 2010 and 2016 and those with a median price of more than $670 in 2017.

  3. The most common retail specialty drugs in 2016 and 2017 were Eli Lilly's Admelog/Humalog and Novo Nordisk's Novolog, both diabetes medications; Eli Lilly's Trulicity, also a diabetes drug; andAbbVie's Humira, used to treat rheumatoid arthritis.

  4. From 2010 to 2017, average annual gross spending on specialty drugs for Medicare Part D beneficiaries rose from $13.5 billion to $50.3 billion, and net spending increased from $11.3 billion to $35.4 billion. For those with private insurance, gross spending increased from $29.9 billion to $76.1 billion, and net spending increased from $24.6 billion to $57.6 billion.

  5. In 2016 and 2017, average annual rebates for Medicare Part D totaled $14.9 billion, which made up 30 percent of gross spending on specialty drugs. Rebates for Medicaid totaled $9 billion, or $53 percent of gross spending. Rebates for private insurance were $18.5 billion, or 24 percent of gross spending.

  6. The growth in spending comes despite the fact that specialty drugs make up a very small portion of retail prescriptions filled. In 2017, specialty drugs accounted for 2.3 percent of filled retail prescriptions, compared to 1 percent in 2010. But the proportion of people who have received at least one retail specialty drug more than doubled, from 2.2 percent in 2010 to 5 percent in 2017.

  7. The study's authors said there were some limitations to the study, including that they may have underestimated Medicaid rebates because they are confidential. The study also lacked separate rebate rates for private insurance and Medicare Part D, and rebates paid to private insurers and Medicare Part D were likely overestimated for various reasons. 

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