- Despite an increase in overall spending, costs per prescription on average are flat or slightly declining
- Prescription drug use reached a record level of 194 billion daily doses in 2021 as new prescription starts for both chronic and acute care recovered from the slowdown recorded in 2020
- Health services utilization returned to pre-pandemic levels by the end of 2021 but has yet to make up for the pandemic-induced backlog in missed patient visits, screenings and diagnostics, elective procedures, and new prescription starts
- Spending on medicines is expected to return to pre-pandemic growth trend lines by 2023
Spending on medicines in the United States, at estimated net manufacturer prices, reached $407 billion in 2021, up 12% over 2020, as COVID-19 vaccines and therapeutics became widely available and added $29 billion in related spending. That’s according to a new U.S. Medicines Trends 2022 Report, released today by the IQVIA Institute for Human Data Science. In the same year, the non-COVID medicines market grew more slowly, at 5%, from the growing impact of biosimilars, which increased significantly, offsetting increased use of branded medicines.
Patient out-of-pocket (OOP) costs in aggregate rose $4 billion, or 5.3%, in 2021 to a total of $79 billion, back to the level seen in 2018 after two years of declining costs. Those OOP costs remain a significant burden for a relatively small part of the population, even as average costs per prescription were flat or slightly declining.
“The rise in U.S. medicine spending was largely driven by the increased availability of pandemic vaccines, boosters, and treatments. It’s a testament to the resiliency of the biopharmaceutical ecosystem to respond successfully to a healthcare crisis at both the global- and country-level, while continuing to improve outcomes across the broader healthcare spectrum,” said Murray Aitken, IQVIA senior vice president and executive director of the IQVIA Institute for Human Data Science. “However, the $4 billion increase in OOP costs for patients matched the historical high previously seen in 2018, which is a trend we will need to continue to watch.”
A few key highlights of the report include:
- Health services utilization: The utilization of health services returned to near pre-pandemic levels by the end of 2021 but has yet to make up for the existing backlog of missed health services. The IQVIA Health Services Utilization Index — which tracks patient visits, screening and diagnostic tests, elective procedures and new prescription starts — increased to a level of 99 at the end 2021 compared to a baseline of 100 during the first eight weeks of 2020. This reflects a strong recovery in activity since the second quarter of 2020, when the index stood at 66.
- Prescription drug use: Prescription drug use reached a record level of 194 billion daily doses in 2021 as new prescription starts for both chronic and acute care recovered from the slowdown recorded in 2020. Days of therapy for all types of prescription medicines were up 3.3% last year, rebounding from the 1.9% growth in 2020, when usage was significantly disrupted by the pandemic.
- Net vs. list price: Differences between list price spending and payer net spending exceeded $190 billion in 2021, representing a 24% discount off of average list price. That’s up from $118 billion, or 20% discount, in 2016 as negotiated discounts and rebates to payers and providers increased in competitive markets and 340B organizations accounted for a larger share of medicine use. That increase was largely driven by growth in auto-immune and oncology treatments, which have tripled in spending over that period while traditional drug classes have declined by 3% in aggregate.
- Forecast through 2026: U.S. use and spending on medicines are expected to return to pre-pandemic growth trends by 2023 despite year-to-year fluctuations and incremental spending on COVID-19 vaccines and therapeutics. We expect to see compound annual growth of 2.1% (range of 1-4%) through 2026 and total market size of about $450 billion on a net manufacturer price basis. Those levels are comparable to pre-pandemic rates.
The full version of the report, including a detailed description of the methodology, is available at www.IQVIAInstitute.org. The study was produced independently as a public service, without industry or government funding.
About the IQVIA Institute for Human Data Science
The IQVIA Institute for Human Data Science contributes to the advancement of human health globally through timely research, insightful analysis and scientific expertise applied to granular non-identified patient-level data.
Fulfilling an essential need within healthcare, the Institute delivers objective, relevant insights and research that accelerate understanding and innovation critical to sound decision making and improved human outcomes. With access to IQVIA’s institutional knowledge, advanced analytics, technology and unparalleled data, the Institute works in tandem with a broad set of healthcare stakeholders to drive a research agenda focused on Human Data Science, including government agencies, academic institutions, the life sciences industry, and payers. More information about the IQVIA Institute can be found at www.IQVIAInstitute.org.
IQVIA (NYSE:IQV) is a leading global provider of advanced analytics, technology solutions, and clinical research services to the life sciences industry. IQVIA creates intelligent connections across all aspects of healthcare through its analytics, transformative technology, big data resources and extensive domain expertise. IQVIA Connected Intelligence™ delivers powerful insights with speed and agility — enabling customers to accelerate the clinical development and commercialization of innovative medical treatments that improve healthcare outcomes for patients. With approximately 79,000 employees, IQVIA conducts operations in more than 100 countries.
IQVIA is a global leader in protecting individual patient privacy. The company uses a wide variety of privacy-enhancing technologies and safeguards to protect individual privacy while generating and analyzing information on a scale that helps healthcare stakeholders identify disease patterns and correlate with the precise treatment path and therapy needed for better outcomes. IQVIA’s insights and execution capabilities help biotech, medical device and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders tap into a deeper understanding of diseases, human behaviors and scientific advances, in an effort to advance their path toward cures. To learn more, visit www.iqvia.com.