Feeling left out, Prime Therapeutics sent me its heretofore unpublished 2013-2015 forecasts. So, today’s article is a Drug Channels exclusive. Highlights:
- Prime expects traditional trend to be much higher than either Express Scripts or CVS Caremark. See below for their explanation.
- Prime’s specialty forecast is comparable to the outlook from the big two PBMs.
- In 2017, Prime expects specialty drugs to be 50% of combined pharmacy and medical benefit drug spending.
Check back in three years and we’ll see which PBM turned out to be right. In the meantime, Prime has started a Drug Trend blog.
THE FORECASTS
The table below summarizes the latest forecasts for overall, traditional (non-specialty), and specialty drug trends. The table now includes CVS Caremark, Express Scripts, and Prime Therapeutics. Click the table to enlarge it.
See New Drug Trend Forecasts: Express Scripts vs. CVS Caremark for my comments on the forecasts from CVS Caremark and Express Scripts.
Traditional (Non-specialty) Forecasts
Compared to the big two PBMs, Prime expects much faster growth in traditional drug spending.
Most notably, Prime disagrees with Express Scripts’ projection for negative drug trend. As Prime explains:
“Prime’s book-of-business generic rate is already bumping up against what we consider to be the peak generic rate of about 85 percent. While there may be opportunity for employer groups who have not fully maximized their generic use, we believe the overall lack of new generics on the horizon, combined with increased drug utilization, reduces the likelihood of a negative traditional drug trend.”Specialty Forecasts
Prime’s outlook for annual specialty drug trend is consistent with the other PBMs.
At the recent Academy of Managed Care Pharmacy meeting, Prime released Specialty Drugs are Forecasted to be 50 Percent of All Drug Expenditures in 2018. I encourage you to read this poster, which explains the method, data, and results. Here is a summary chart of Prime's specialty spending forecast:
Note that the forecast for drug expenditures include both pharmacy benefit payments and medical benefit allowed amounts. The poster also has some neat data about the specific therapies behind specialty spending.
SO, WHAT HAPPENED TO THE DRUG TREND REPORT?
I (gently) mocked Prime’s decision to forgo a formal drug trend report in favor of this comic strip, er, I mean “infographic.” As Prime explains:
“Few people outside the industry’s inner circle have sufficient understanding of pharmacy benefit management – particularly the complex underlying factors that influence the landscape – to gain much insight from a traditional drug trend report. That’s why we sought to present a brief overview of key information that is top of mind during “drug trend season” an easily-digestible, memorable way…”Fair enough. However, true Drug Channels wonks (ahem) would have preferred to have the detailed report to complement cartoons of the Eiffel Tower and a Ferrari. Just my $0.02. YMMV.
Adam,
ReplyDeleteThanks for sharing!
I think Prime’s view of the Traditional Drug Trend reflects two things
1. They were ahead of the curve in driving to generics over the other PBM’s
2. It provides a ‘view’ of how Traditional drugs will continue to be valuable as the financial impact of generics, driven by Retail’s $4.00 or free product will continue to erode the basic value proposition of how PBM’s have operated in the channel. (I think of the day when major chains have a “store formulary” that eliminates the need for PBM current one)
Adam,
ReplyDeleteLoved your comment about the 10 ft long comic strip. I guess all the PBMs have gone to “infographics” rather than real publications and I find this to be very annoying as well. There is no way to download the publications and use it as a reference.
Debbie