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Retail prescription drug spending in the
US increased for the fifth straight year in 2000, primarily
reflecting higher sales of a relatively small number of drugs.
As an aging population coped with arthritis,
diabetes and high cholesterol, spending
on prescription drugs shot up nearly
20 percent last year, to $132 billion.
Two dozen products accounted for half
the increase, which occurred not just because drugs are becoming
more expensive but because doctors
are writing many more prescriptions for higher-cost drugs,
the study said.
The study was issued today by the National
Institute for Health Care Management Foundation, a nonprofit,
nonpartisan group that conducts research on health care issues.
The trend will probably increase political
pressure for new government benefits to help elderly people
buy prescription drugs, but it also makes clear how costly
such benefits could be. President Bush has proposed spending
$153 billion on drug benefits and unspecified "Medicare
reforms" over the next 10 years, but Democrats say that
sum is grossly inadequate, and the foundation's study may
provide new ammunition to both sides.
The $21 billion increase in spending "was
attributable, in large measure, to the rising volume of prescriptions
for the top-selling drugs," the study said. Researchers
said more aggressive marketing
by drug companies contributed to the growth.
The top sellers include Vioxx,
an arthritis drug made by Merck & Company; Lipitor,
a cholesterol reducer sold by Pfizer; Prevacid,
an ulcer drug sold by Tap Pharmaceuticals; Celebrex,
an arthritis medicine marketed by Pharmacia and Pfizer, and
Glucophage, a
diabetes drug made by Bristol-Myers Squibb.
The increase in sales of these five drugs
alone accounted for one-fifth of the entire increase in sales
of prescription drugs last year, the study said.
The rate of increase in drug spending
was about the same last year as in 1999, so the foundation
estimates that drug spending
rose 40 percent from 1998 to
2000.
That growth has pushed up health insurance
premiums for individuals and families. It has contributed
to increases in the cost of health benefits provided by employers.
And it has driven up the cost of Medicaid, the federal-state
program for the poor.
The report identified three factors contributing
to the increase in retail spending on prescription drugs last
year. It said that 42 percent was attributable to an increase
in the number of prescriptions written by doctors
and filled by pharmacies.
At the same time, it said, a shift
toward the use of more expensive drugs accounted
for 36 percent of the overall increase in spending, while
price increases
accounted for the remaining 22 percent.
The 50 top-selling medicines accounted
for 30 percent of all prescriptions last year, and these medications
cost almost twice as much as other drugs, the report said.
The average price for a prescription for one of the top 50
drugs was $67, while the average for other drugs was $36,
it said.
Retail pharmacies filled 3 billion prescriptions
last year, an increase of over 7 percent over the 2.7 billion
filled in 1999, the study said. But the 50 best-selling drugs
posted a much sharper increase, as the number of prescriptions
rose over 18 percent, to 867 million, from 731 million.
The government recently predicted that
drug spending would rise an average of 12 percent a year in
the coming decade, as scientists unlock secrets of the human
genome, the baby boom generation ages and the nation pours
huge sums into biomedical research, filling the pipeline with
potentially useful new drugs.
Drug companies say they are developing
more than 350 medicines to fight cancer and more than 120
to treat or prevent heart disease and stroke.
Antidepressants
were the best- selling category of prescription medicines
last year, as they were in 1999.
Retail sales of antidepressants totaled over $10 billion in
2000, up 21 percent from the previous year.
The average price for a prescription of
antidepressants was $68 last year, up from $63 in 1999.
The report said this change "reflects
a rise in the price of individual drugs, but also the fact
that pharmacies are dispensing more of the more expensive
antidepressants such as Paxil, Celexa and Wellbutrin."
These drugs, it said, are 50 percent to 75 percent more expensive
than other antidepressants.
Comparing the number of prescriptions
filled in each of the last two years, the study found that
retail pharmacies dispensed 42 percent more Celebrex, 32 percent
more Lipitor, 31 percent more Prevacid, 30 percent more Viagra
(for impotence), 71 percent more Enbrel (for rheumatoid arthritis)
and 74 percent more Singulair (for asthma).
Nancy Chockley, president of the National
Institute for Health Care Management Foundation, said: "The
recent rise in pharmaceutical spending is due, in large measure,
to the growth in sales of a relatively small number of medicines.
Most of these drugs are the blockbusters many Americans have
come to know by name and see advertised more and more."
More aggressive
marketing of prescription drugs to consumers and
doctors has stimulated a major increase in sales, in part
because consumers learn of new remedies and ask their doctors
for prescriptions, researchers said. Better insurance coverage
for drugs has also contributed to the trend, by making consumers
somewhat less sensitive to drug prices.
Nineteen drugs had retail sales exceeding
$1 billion last year, up from 15 such drugs in 1999. Leading
the list of top sellers was Prilosec,
the antiulcer drug sold by AstraZeneca, with sales of $4 billion
last year, up from $3.6 billion in 1999.
While total sales of prescription drugs
rose 19 percent last year, sales of the 50 best-selling drugs
rose 30 percent, to $58 billion, from $45 billion in 1999.
Drugs to treat ulcers, heartburn and other
gastrointestinal problems were second to antidepressants in
overall sales. Retail sales of these medicines totaled $9.5
billion last year, up 20 percent from 1999. Sales of Prilosec
rose 12.4 percent, to $4 billion last year, while sales of
its main competitor, Prevacid, increased 37 percent, to $3
billion.
The study was based on data from Scott-Levin
Inc., a health care market research company in Newtown, Pa.
The figures do not include mail- order sales. But the report
said mail- order sales of prescription drugs totaled $16 billion
last year, up 26 percent from $12.7 billion in 1999.
NewYork
Times May 8, 2001
National Institute
for Health Care Management Research and Educational Foundation
May 11, 2001
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