Although the pharmaceutical spending trend has declined in recent years, according to the Segal Company’s 2010 Health Plan Cost Trend Survey, the projected prescription drug trend is still 9.1% for the coming year, well above the country’s general inflation rate. This year’s figure is down significantly from the high of 19.7% reported in 2001.
Running counter to this trend is spending for so-called specialty drugs, which according to the same survey is expected to be nearly 18% for 2010 or double that of the general prescription drug trend. The biggest driver of the specialty drug trend is the growth in prescription drug use among children according to the 2010 Drug Trend report from Medco. This growth was almost four times greater than the increase of prescription drug use among the general population. During the past nine years, the spike in specialty drugs has been driven by the increased use of antipsychotic, diabetes, and asthma drugs among children. In 2009, researchers found that more than one in four insured children in the US, and almost 30% of adolescents took at least one prescription drug for a chronic condition.
Sadly, the obesity epidemic in the US is taking a toll, and no longer applies to adults only. Consequently, more 10- through 19-year-olds are developing diseases that used to be seen only in adults. Many of these diseases require ongoing, and expensive, drug therapy. Another large contributing factor for specialty drug use in children is the diagnosis of ADHD. About 13% of prescription drug benefits spent on children are for ADHD treatments. Furthermore, research is now showing that many children who begin drug therapy for ADHD continue the therapy through the ages of 20-34.
In addition to medications that treat mental illness, diabetes, and asthma in children, what are other specialty drugs and why do they come at such a cost? The term “specialty drugs” encompasses types of pharmaceuticals that might differ from other prescribed products in their development, in how they are administered to the patient, and in their storage and handling requirements. For example, some specialty drugs are biologics-genetically engineered drugs. Some require administration by injection or infusion, or administration only by a medical professional. Some have special storage, handling and distribution requirements, meaning that they may not be available through the local pharmacy.
Specialty drugs target complex and chronic conditions. Medical conditions for which specialty drug therapy currently is available include cancer, mental illness, human growth hormone disorders, hemophilia, psoriasis, multiple sclerosis, rheumatoid arthritis, immune disorders, infertility, Crohn’s disease, Parkinson’s disease, lupus, diabetes and HIV/AIDS.
Though expensive, a specialty drug — like any appropriately prescribed and properly managed pharmaceutical — ultimately can be a cost-effective part of a patient’s therapy if it aids in that patient’s recovery or prevents a condition from worsening, alleviates pain, or averts the kinds of medical costs and complications that can result from hospitalization and more intrusive interventions. However, because the cost of specialty drugs is so high, health plans and pharmacy benefit managers have implemented various controls to ensure that the outlays for these medications are well-spent and geared toward achieving the desired outcomes. Support services that commonly are seen in specialty drug management programs include injection training, extensive patient education, 24/7 dispensing services, patient monitoring to assure compliance, and automatic refill reminders.
Pharmaceutical market trends and the ongoing development of an increasing number of specialty drugs indicate that this area of pharmacy will grow, and with it the potential impact on an employer’s health care costs. Employers would be well advised to get a handle on how their employee population is utilizing these products, and how their health plan and/or pharmacy benefit manager (PBM) is managing the benefits. Areas to examine include plan design, the plan’s or PBM’s initiatives to secure discount pricing and dispensing fees, and how the plan or PBM ensures optimal patient compliance with their specialty drug regimen.