The explosive growth in the specialty drug sector challenges the sustainability of the U.S. health system because there are not enough loss-of-earnings offsets to cover the increases.
The specialty drug sector now represents about one-third of all drug spending in the U.S., a 23% increase from five years ago. In addition, specialty drugs now hold a sizable share of new molecular entity (NME) launches. In the past five years, 52% of NMEs have been specialty drugs, representing a 40% increase from 2005-2009.
This explosive growth in the specialty drug sector challenges the sustainability of the U.S. health system because there are not enough loss-of-earnings (LOE) offsets to cover the increases, according to Douglas M. Long, vice president of Industry Relations for IMS Health, Ponte Vedra Beach, Florida.
Speaking at the Academy of Managed Care Pharmacy meeting in a session entitled The U.S. Pharmaceutical and Specialty Market: Looking back and Looking ahead, Long provided a snapshot of the current pharmaceutical market and the expected changes in the demand and payment for medical care.
The rapid growth in specialty drugs has been in part driven by innovations in treatments for hepatitis C, cancer, multiple sclerosis and diabetes. Over the past decade, said Long, the research and development pipeline has shifted to specialty medicines, with 10 breakthrough therapies being launched. In 2014, 42 new active substances were launched-up from 36 in 2013-that provided major advances in the treatment of hepatitis C, multiple sclerosis and cancer.
Long explained that orphan drugs are a significant driver of innovation and more can be expected in the future. Incentives from the Food and Drug Administration have encouraged a surge in drug development for infectious diseases, he noted. In 2014 and 2013, 18 and 17 orphan drugs were launched, respectively, representing the two highest years ever of orphan drug launches.
Long also discussed the change in revenues because of generic competition for many drugs and, recently, for biologics. Products facing LOE in the next four years are valued at $78.4 billion, he said. He also highlighted the emergence of biosimilars that are making steady progress.
Overall, according to Long, market access will be key in the future success of a drug and “real world evidence will play a key role in determining how successful a drug will be in the future.”
Changes in demand and payment for medicine that will play a role include:
In this second part of a two-part podcast episode, Managed Healthcare Executive's Managing Editor Peter Wehrwein spoke with Ceci Connolly and Margaret "Meg" Murray about Medicare Advantage utilization and challenges, highlighting proposed CMS payment cuts and prior authorization issues.
Listen
The Departments of Health and Human Services (HHS), Labor, and the Treasury, released final rules on short-term, limited-duration insurance (STLDI) and independent, non-coordinated excepted benefits coverage, addressing issues related to the low-quality insurance, or "junk insurance" plans.
Read More
In this first part of a two-part podcast episode, Managed Healthcare Executive's Managing Editor Peter Wehrwein kicks off our new podcast series "DC Roundtable," with guests Margaret "Meg" Murray, CEO of the Association of Community Affiliated Plans, and member of MHE's Editorial Advisory Board, and Ceci Connolly, president and CEO of the Alliance of Community Health Plans, for a discussion on healthcare policy issues.
Listen
2024 Emerging Leaders in Healthcare — Submit For a Chance to Be Featured in MHE's August Issue
March 28th 2024MHE Editors are seeking diverse healthcare professionals from different backgrounds and healthcare sectors, with individual interests. Eligible candidates are early or mid-career leaders with less than 10 years of experience. Award winners will enjoy complimentary passes to the PBMI Annual National Meeting in Orlando, Florida, from Sept. 4-6. Additional perks include a feature in our August issue, a subscription to MHE and more!
Read More
Muthiah “Muthu” Vaduganathan Discusses the Role of SGLT2 Inhibitors in Heart Failure Treatment
March 27th 2024Editors of Managed Healthcare Executive spoke with Muthiah “Muthu” Vaduganathan MD, MPH, consultant cardiologist at Brigham and Women's Hospital and a member of faculty at Harvard Medical School, about the evolving treatment landscape for heart failure, emphasizing the use of SGLT2 inhibitors alongside other foundational therapies.
Read More