Specialty, traditional drug cost divide to widen

Insurers can expect spending on traditional medications to remain relatively flat over the next few years, but watch out for specialty drugs because that’s where costs will soar, according to the 2013 Drug Trend Report by Express Scripts, released in April. Spending on traditional drugs will climb about 2% annually until 2016, while spending on specialty drugs is expected to jump 16% during the same period. (The specialty drug estimate is very conservative; about half of specialty medication costs are billed through the medical benefit and therefore not included in the Express Scripts calculations.)

Utilization of specialty drugs will be driven in part by development of targeted therapies. Immunotherapies are also highly anticipated, and probably will be billed as a medical benefit. As for traditional medications, Express Scripts says the largest increases this year are expected for diabetes medications, which it says “continue to see brand drug innovation,” and for drugs to treat attention disorders.

Traditional drugs: Spending on diabetes drugs to increase most

Expenditure for specialty drugs to increase dramatically

Source: 2013 Drug Trend Report, Express Scripts, Maryland Heights, Mo., 2014