Drug spending increase highest in a decade

Drug spending increase highest in a decade
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U.S. prescription drug spending rose 13 percent last year, the largest increase since 2003, according to a new report. 

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The report from Express Scripts, the largest U.S. manager of prescription benefits, notes that much of the spike in drug prices was driven by increases in a few specialty areas. 

Drugs to treat hepatitis C stand out particularly, because new drugs that can provide better treatment are very expensive.  Spending on those drugs increased by 743 percent. 

The drugs Sovaldi, Olysio, and Harvoni have all been introduced in the last two years to treat hepatitis C. Sovaldi, for example, costs around $84,000 for a 12-week treatment, according to the report. 

"For the past several years, annual drug spending increases have been below the annual rate of overall healthcare inflation in the U.S., but that paradigm is shifting dramatically as prices for medications increase at an unprecedented and unsustainable rate,” Glen Stettin, a senior vice president at Express Scripts, said in a statement. 

Excluding some of these more expensive specialty medications, more common traditional drug spending increased by around 6 percent, though that is still somewhat higher than recent years. 

Medicare drug spending is affected at about the same rate as overall drug spending, with Medicare spending increasing 13.8 percent.

The report projects that spending on traditional drugs for conditions like high cholesterol and heart disease will not increase substantially in coming years, in part because of competition from generic drugs. 

On the specialty drug side, “expensive, highly targeted therapies” treating conditions like HIV and hepatitis C are projected to keep up double-digit spending growth.