• linkedin
  • Increase Font
  • Sharebar

    Why Specialty Drug Prices Will Continue to Soar

    Specialty drugs will dominate the future of pharmaceuticals.

    The coming pharmaceutical blockbusters will be specialty drugs.

    They will account for 42% of overall pharmacy revenues in 2021, according to new data.

    “Pharmacy industry revenues have been shifting from traditional brand-name drugs to specialty drugs,” wrote Adam J. Fein, PhD, CEO of Drug Channels Institute, in a blog post about the institute’s outlook for 2021 specialty pharmacy. “This shift will continue, because the next-generation pharmaceutical blockbusters will primarily be specialty products aimed at smaller patient populations than were the mass-market blockbusters of yesteryear.”

    Related article: Considering Specialty Pharmacy? Make Your Move

    Because of this shift, most of the industry’s best-selling drugs by revenue will be specialty drugs, not traditional drugs. Overall pharmacy revenues will reach $572 billion in 2021, and specialty drugs will account for around $240 billion of that revenue, according to Drug Channels (Figure 1).

    Figure 1

    Fig. 1

    In 2016, specialty drugs accounted for 28% of the pharmacy industry’s prescription dispensing revenues, up from 17% of revenues in 2011. Retail, mail, long-term care, and specialty pharmacies dispensed an estimated $115 billion in specialty pharmaceuticals in 2016.

    Specialty drugs now account for $384 of the $895 per-person per-year spent on medications.

    New research from QuintilesIMS Institute demonstrates a similar upward trend for specialty drugs. Specialty medicines accounted for 42.6% of net drug spending in 2016, and drove 60.8% of new brand spending growth, driven by oncology, HIV, and autoimmune drugs, according to the organization’s report, Medicines Use and Spending in the U.S.

    “The largest proportion of the new medicines launched in the last five years have been specialty drugs, and the specialty share of spending has risen while traditional net medicine spending has declined by more than $100 per person over the past decade,” QuintilesIMS said.

    Related article: Business Group Makes Price Recommendations for Specialty Drugs

    Specialty medicines have been an increasing share of medicine spending over the past decade, rising from 21.8% of spending in 2007 to 39.6% in 2016 on an invoice-price basis.

    For retail and mail pharmacies, specialty medicines are 32.5% of spending and 1.9% of prescriptions, according to QuintilesIMS. However, in non-retail pharmacy settings, specialty medicines represent 58% of invoice spending and 2.6% of standard unit volumes.

    “Across all settings, specialty medicines treat relatively few patients, and have costs far higher per patient than traditional medicines,” the report said. “Usage of specialty medicines is often less influenced by cost and instead due to extreme medical need, making it even more difficult to balance population health and overall cost concerns with the needs of an individual patient.” 

    Christine Blank
    Contributing Editor Christine Blank is a freelance writer based in Florida.

    0 Comments

    You must be signed in to leave a comment. Registering is fast and free!

    All comments must follow the ModernMedicine Network community rules and terms of use, and will be moderated. ModernMedicine reserves the right to use the comments we receive, in whole or in part,in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.

    • No comments available