Therapeutic Substitution Could Lower Prescription Drug Spending

Avoidable brand-name costs reached $73 billion in three years, study finds

Americans spent an extra $73 billion on brand-name medications between 2010 and 2012, a new study concludes, and the practice of therapeutic substitution could help to drive down those costs.

Therapeutic substitution—exchanging chemically different compounds within the same class of drugs for one another—is a controversial way to improve the efficiency of the pharmaceutical market because it is opposed by many physician organizations as an attack on physician autonomy.

The study by Michael E. Johansen, MD, of Ohio State University in Columbus, and Caroline Richardson, MD, of the University of Michigan in Ann Arbor, was published online by JAMA Internal Medicine. The authors used data on 107,132 people in the Medical Expenditure Panel Survey, along with their reported prescription medicine use, to estimate potential savings through therapeutic substitution. The researchers looked at overall and out-of-pocket expenditures.

The study included drug classes that in a given year contained both a generic or widely accessible over-the-counter drug and a brand-name drug without an available chemically equivalent generic.

Of the 107,132 individuals, 62.1% reported using prescribed medicine between 2010 and 2012 and 31.5% used medication from an included drug. A branded drug from an included class was used by 16.6% of individuals compared with 24% who used a generic and 9.1% who used both, according to the results.

Overall, prescription medication spending reached $760 billion between 2010 and 2012. The extra money spent because of brand drug overuse accounted for 9.6% of total prescription medication expenditures. Total out-of-pocket expenditures between 2010 and 2012 were $175 billion, of which 14.1% was because of brand-drug overuse, according to the results.

Drug classes where the most extra money was spent included statins, atypical antipsychotics, proton pump inhibitors, selective serotonin reuptake inhibitors, and angiotensin receptor blockers, the study notes.

The authors acknowledge a number of study limitations, including estimates of pharmaceutical rebates and the overuse of branded drugs within drug classes.

"There was a large amount of excess expenditure on branded drugs between 2010 and 2012 in classes that could have incorporated therapeutic substitution. Although therapeutic substitution is controversial, it offers a potential mechanism to decrease drug costs if it can be implemented in a way that does not negatively affect quality of care," the authors conclude.

Sources: JAMA Network Journals; May 9, 2016; JAMA Internal Medicine; May 9, 2016.