2016 Drug Trend Report Executive Summary

Transcription

1 COMMERCIAL 2016 Drug Trend Report Executive Summary EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 1

2 Driving undeniable value for plans and patients in 2016 The issue of rising drug prices dominated the news in 2016, amplified by highly publicized examples of egregious price hikes and patients in high-deductible plans who found themselves paying hundreds or even thousands of dollars for medication. The increased attention has led to many discussions about high drug prices and what can be done to make medicine more affordable. Let s get past the rhetoric and get to the facts: Drug makers set the prices for their medications. They can lower those prices at any time. Express Scripts is effective in protecting employers from the effects of inflation by using our focused size and scale to secure significant rebates, which are returned to employers to reduce the overall cost of their pharmacy benefit. Our job is to put medicine within reach to make it more accessible and affordable for the clients and members we serve. It s the reason we exist. It s not just that we keep costs down, it s the way we keep costs down that matters. We put patients first. And with 98% of our clients electing to stay with us, we know we re doing something right and something very important. In fact, there has never been a more critical time to be doing what Express Scripts does. In a year where the high cost of prescription drugs dominated the industry, our work enabled our clients and members to have a different and better experience. And in a world where value-based care is being debated in terms of what form it takes or how it gets delivered, we re showing you here that it works. Glen Stettin, MD Senior Vice President, Clinical, Research & New Solutions & Chief Innovation Officer

3 Bending the curve on drug spending U.S. drug spending increased just 3.8 % in 2016, 27 % less than in 2015 For plans covering employees and their families, per-person spending on prescription drugs increased just 3.8%, 26.9% less than the 5.2% increase in The increase in specialty drug spending was the lowest since we first included specialty drugs in our 2003 analysis. Specialty drugs accounted for more than a third of total spending in While use of traditional drugs increased modestly, spending decreased in 2016, mitigated by continuing downward pressure on prices. Now, one of the most powerful forces on the side of drug payers is pushing back. UTILIZATION TREND 2015 VS UNIT COST TREND 2015 VS TOTAL TREND 2015 VS % The New York Times Sept. 8, % 3.8 % 2.0 % 2.5 % 1.3 % January-December 2016 compared to same period in 2015 for commercially insured plans managed by Express Scripts. Reflects total cost for both payers and patients, net of rebates. Total trend is comprised of utilization trend and unit cost trend. Utilization trend is the rate of change in total days supply of medication per member, across prescriptions. Unit cost trend is the rate of change in costs due to inflation, discounts, drug mix, rebates and member cost share. Amounts are rounded to one or two decimals. EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 3

4 Cutting spending down to size with smarter plan management Drug spending decreased for one third of plans in % of employers with a pharmacy plan managed by Express Scripts spent less per person on prescription drugs in 2016 compared to In today s competitive environment, we ve found Express Scripts to be the best valuedriven, prescription drug resource for our employees, retirees and dependents. Our prescription drug program could not be in better hands. Dan Stewart Associate Vice Chancellor for Employee Benefits and Services University of Texas These plans adopted many of our strategies for minimizing waste, maximizing savings and ensuring access to the medications patients need to get and stay well, including: 3 Express Scripts National Preferred Formulary (NPF) 3 Express Scripts SafeGuardRx SM, with solutions for hepatitis C, high cholesterol and oncology 3 Access to medications for rare and complex conditions through our Accredo specialty pharmacy 3 Specialized care through each Express Scripts Therapeutic Resource Center 3 Access to the Express Scripts Pharmacy SM for home delivery of medicines for chronic needs 3 Utilization management, such as step therapy and prior authorization, to ensure appropriate coverage Total drug spending for plans that tightly manage the pharmacy benefit increased just 2.6%, significantly lower than lesser-managed plans. If all U.S. pharmacy plans had tightly managed their benefit, the country could have saved an additional 5.8 billion on prescription drugs last year. TREND FOR MANAGED PLANS 2016 BY LEVEL OF COST-CONTROL STRATEGIES APPLIED 9.1 % 5.4 % 2.6 % 33 % OF PLANS SPENT LESS PER PERSON ON PRESCRIPTION DRUGS IN 2016 Lightly managed Average Tightly managed EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 4

5 Keeping dollars in patients pockets The share of costs per prescription paid by Express Scripts members decreased slightly in 2016 Member out-of-pocket (OOP) cost share was 14.6% of the total costs per adjusted Rx in 2016, down from 14.8% in 2015, as many plans held the line on copayments and deductibles. Plans also participated in Express Scripts programs for reining in prices and helping patients choose lower-cost drugs. The average member OOP cost for a 30-day prescription was in 2016, only 9 more than in Express Scripts and Accredo connected qualifying specialty pharmacy patients with 463 million in copay assistance in PBMs, employers and health plans are working to ensure a competitive marketplace and hold down costs for consumers. MEMBER OUT-OF-POCKET (OOP) COSTS PER ADJUSTED RX 2015 VS RealClear Health Nov. 4, 2016 MEMBER OOP COST SHARE 14.8 % MEMBER OOP COST SHARE 14.6 % INCREASE IN TOTAL COST PER ARx ONLY 9c INCREASE IN MEMBER OOP COST EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 5

6 Limiting the impact of brand-drug price increases to hold down plan costs Average unit costs rose just 2.5 %, 22 % less than in 2015 Average list prices for the most commonly used brand-name drugs increased 10.7% in 2016; however, commercial plans managed by Express Scripts experienced only a 2.5% increase in unit costs across all prescription drugs, net of rebates 21.9% lower than the 3.2% increase in Specialty drug costs rose 6.2% in 2016, down significantly from the 11.0% increase in Traditional drug costs decreased 2.3% in 2016, after dropping 2.1% in We partnered with Express Scripts to implement solutions across several lines of business, integrating data to offer crucial insights for providers, cutting wasteful spending and ensuring member satisfaction, care and safety. Sarah Marche, PharmD Vice President of Pharmacy Services Highmark Inc. From the Jan base price of 100, Dec prices (in 2008 dollars) for the most commonly used brand drugs increased to , a 207.9% increase. In contrast, a market basket of commonly used household goods costing 100 in 2008 rose to only Prices for the most commonly used generic medications declined to 26.27, down 8.7% this year and 73.7% lower than the base price. EXPRESS SCRIPTS PRESCRIPTION PRICE INDEX 2016 Index Jan Brand Prescription Price Index Jan Jan Jan Generic Prescription Price Index Jan Jan Jan Jan Consumer Price Index U.S. Bureau of Labor Statistics 208 % increase Jan SPECIALTY UNIT COST TREND 2015 VS % 6.2 % EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 6

7 Driving significant savings while ensuring patients have access to care In 2016, plans saved 1.3 billion and patients continued to have access to medicines they need to stay healthy with our National Preferred Formulary Smarter formulary management makes medicine more accessible and more affordable. The Express Scripts National Preferred Formulary saved plans 1.3 billion in 2016 and is projected to save another 1.8 billion in 2017, for a total of 4.9 billion since Express Scripts is a valued partner in making prescription drugs more affordable and accessible for members. The value network we implemented is a great example of how Express Scripts is helping us achieve our goals. In 2016, the NPF excluded just 80 of approximately 4,000 available drugs, ensuring that 99.5% of members covered by the formulary were not affected by the changes. FORMULARY SAVINGS M 1.05B 1.3B 1.8B 4,000 AVAILABLE DRUGS Johanna Melendez AVP of Pharmacy EmblemHealth 4.9B ONLY 80 TOTAL SAVINGS EXCLUDED DRUGS (2.0 % ) Projected EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 7

8 Achieved industry-leading adherence for high-risk patients who required PCSK9 inhibitors: 89.3% at Accredo specialty pharmacy vs. 82.1% at other pharmacies Launched indication-specific management for certain anti-inflammatory drugs and guaranteed refunds if a patient discontinues treatment early Partnered on innovative pilots with more than 300 clients representing over 6 million members Kept the average copay for insulin at just per adjusted Rx, only a 1.63 increase over 2015 Lowered the cost of hepatitis C treatment by 50% for 50K+ patients with a cure rate greater than 95% In a world without Express Scripts and Accredo, none of this would have happened in 2016 Saved plans 2 billion with our actions to eliminate 95% of spending on compounded drugs Announced a solution that caps spending for employers and offers a quality-based pharmacy network for patients with diabetes Introduced value-based pricing for certain oncology drugs and guaranteed refunds if a patient discontinues treatment early Enabled plans to keep the average member out-of-pocket cost for EpiPen at 73.50, only 45 more than in 2015, even as the price soared 51% EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 8

9 Top 15 therapy classes driving spending in 2016 COMPONENTS OF TREND FOR TOP 15 THERAPY CLASSES Click on the blue circles to view specific data for each therapy class RANKED BY 2016 PMPY* SPEND Trend Traditional Specialty Despite having more than 15 available therapies for inflammatory conditions, just two medications accounted for about 70% of market share in Inflammatory conditions 20% HIV Oncology Diabetes 10% Skin conditions Asthma Attention disorders List prices for oral oncology medications, which are not rebated or discounted to any significant extent, doubled between 2011 and 2016, from 20 to 40 per unit. Multiple sclerosis Diabetes trend was 19.4%, driven by a 14.1% increase in unit cost. Spending on insulins, which accounted for 40% of all diabetes drug spend, increased 9.9%. 0-10% Pain/inflammation Contraceptives Depression High blood cholesterol High blood pressure/heart disease PMPY spend -20% Heartburn/ulcer disease -30% -40% Hepatitis C Hepatitis C spending decreased 27.3% due in part to our SafeGuardRx solution, which dramatically lowered costs and increased access to a cure. *Per member per year EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 9

10 Forecasting trend: TREND FORECAST FOR KEY THERAPY CLASSES Trend Traditional Specialty We expect overall annual drug spending to increase 10% to 13% over the next three years, net of rebates Skin conditions 0 Inflammatory conditions Diabetes Oncology Multiple sclerosis Pain/ inflammation HIV High blood cholesterol Attention disorders High blood pressure/ heart disease Asthma Hepatitis C Depression Contraceptives Heartburn/ ulcer disease Other therapy classes Total While diabetes, inflammatory conditions and oncology will continue to drive trend, we anticipate trend totals for all three classes could be further reduced by the ongoing effect of our SafeGuardRx solutions. EXPRESS SCRIPTS 2016 DRUG TREND REPORT COMMERCIAL EXECUTIVE SUMMARY 10

11 2016 Drug Trend Report Get the insights: express-scripts.com/corporate Click to share: 2017 Express Scripts Holding Company. All Rights Reserved. Express Scripts and E logo are trademarks of Express Scripts Holding Company and/or its subsidiaries. All other trademarks are the property of their respective owners. 16EME38524 FEB. 2017