Spending on prescription medications in the United States will increase by 4% to 7% through 2021, reaching $580 billion to $610 billion, according to a report released by QuintilesIMS Holding. The data were summarized in a Reuters report.
QuintilesIMS, which compiles data for the pharmaceutical industry, had previously forecast average spending growth of 6% to 9% in the U.S. through 2021. It reduced its projections because fewer new medications were approved in 2016 than in previous years and because drug-makers are facing increasing pricing pressure and competition.
The FDA approved only 22 new drugs last year, down from 45 in 2015. The QuintilesIMS report expects that to pick up in 2019 and beyond with an estimated 40 to 45 new brand launches per year through 2021.
The report found more than 2,300 novel products in later-stage development, including more than 600 cancer drugs, which can command high prices if they reach the marketplace.
Under pressure from politicians and insurers over the cost of many branded medications, several drug-makers have pledged to keep annual price hikes under 10%, Reuters notes.
Some of the expense of new drugs will be offset by the expanded use of cheaper generics as several big-selling prescription medications lose their patent exclusivity and as more biosimilars enter the market, according to the report.
U.S. spending on prescription medications in 2016 increased by 5.8% compared with 2015 levels to $450 billion, based on list prices, and by 4.8% to $323 billion when adjusted for discounts and rebates.
The biggest drivers of prescription-drug growth came from chronic therapy areas, such as hypertension and mental health. Overall use of pain medications declined 1% as restrictions on prescribing and dispensing became more common.
Source: Reuters; May 4, 2017.