Report: Drug costs to rise 3% to 5% this year

U.S. drug expenditures remained relatively flat in 2011, but a new report projects that drug costs will rise between 3% and 5% across all healthcare settings this year.

The American Journal of Health-System Pharmacy’s annual report, “Projecting Future Drug Expenditures,” published online, also projects a 5% to 7% increase in spending for clinic-administered drugs and an increase in hospital drug expenditures of up to 2%.

The projected spending increases are influenced by a number of factors, including drugs in development, the continuing problem of drug shortages, the increasing availability of generics, and issues surrounding the use of biosimilars, according to the report.

There have been “significant increases” in spending on specialized medications, particularly in the outpatient setting as growth in prescription drug expenditures for clinic-administered drugs (such as cancer treatments) consistently outpaces growth in total expenditures, according the report’s author, James M. Hoffman, PharmD, MS.

There also has been substantial moderation in spending growth on widely used drugs, primarily because of generic drugs, which accounted for 78% of all retail prescriptions dispensed at the end of 2010, the report said.

“What comes through in this document is the complexity of managing drug expenditures and the complexity of safe, effective, and efficient use of medications. Having smart leadership in the pharmacies of hospitals managing all these different drug expenditures is critical,” said David Chen, director of the American Society of Health-System Pharmacist’s Pharmacy Practice Sections.