Vizient forecasts 2.67 percent increase in drug spend in new pharmacy market outlook
Vizient, Inc. released its Winter 2021 Pharmacy Market Outlook, projecting a 2.67 percent increase in the price of pharmaceuticals purchased by health systems, academic medical centers, pediatric hospitals, and non-acute practices, for the period July 1 to June 30, 2022.
Formerly named the Drug Price Forecast, the Outlook’s projected increase continues to trend slightly downward, reflecting recent generic entrants to the market as well as increasing adoption of biosimilars. Findings also include a similar overall increase for oncology spend, which makes up nearly a quarter of Vizient member pharmaceutical spend, a potential increase in cancer mortality due to the impact of COVID-19 on screenings as well as COVID’s inflationary impact on plasma-derived products.
“The trend toward more moderate drug price increases is a welcome one, given the financial difficulties created by the pandemic,” said Dan Kistner, group senior vice president, pharmacy solutions for Vizient. “Even so, without question the pandemic continues to have an impact on clinical and financial outcomes. Increased use of high-cost drugs vasopressin and tocilizumab as well as many critical care drugs used to treat COVID patients are continuing to impact budgets.”
A new formulation of vasopressin was recently approved by the FDA and granted market exclusivity through 2035, causing its price to spike significantly. Several substantial price decreases are projected for drugs like injectable acetaminophen, daptomycin, a commonly used antibiotic, and regadenoson, a medication used in cardiac stress testing, further illustrating the importance of generic and biosimilar competition. The drug with the largest anticipated price increase remains adalimumab, sold under the brand name Humira and used to treat arthritis and ulcerative colitis. As biosimilar competition is not yet allowed to be marketed, adalimumab, which is already the No. 1 drug by total spend for Vizient members and the U.S. health system alike, is projected to increase in price by 7.5 percent over the next 18 months.
Other highlights from the Outlook include:
· Oncology medications, which make up 24.67 percent of pharmaceutical purchases, are projected to increase 2.68 percent. Wholesale acquisition cost for intravenous drug pegaspargase increased 19.2 percent in 2020. The oral medication nilotinib increased 15.5 percent.
· Data from the Vizient Clinical Data Base for non-inpatient cancer show that screening rates for breast, colon, and cervical cancer plummeted in April, which contributed to a 65.2 percent decline in the incidence of new cancer diagnoses as of May. Delays in detection and diagnosis of cancer can have a significant impact on patient outcomes. While screenings recovered by August, research from the Cancer Network, home of the journal Oncology, suggests mortality increases up to 9.5 percent from breast cancer and up to 16.6 percent for colorectal cancer within five years. The long-term impact of COVID-19 on cancer patients remains a critical metric to track.
· IgIV and albumin Even prior to the pandemic, prices for albumin and other plasma-derived products have remained a closely monitored issue. Vizient projects supply to tighten in the first quarter of 2021 due to a reduction in plasma donations because of stay-at-home orders and public concerns about contracting the virus and potentially remain tight into 2022 resulting in a 3.10 percent inflation rate for these products.
· After ten years on the market, biosimilars are poised to make their greatest impact yet in the next half decade. As of Dec. 31, the FDA had approved 29 biosimilars with many yet to be launched due to patent settlements. A recent analysis shows the availability of biosimilars resulted in cost savings of $19 billion between 2015 and 2019. That savings is expected to quintuple by 2024 to $104 billion. Biosimilar versions of trastuzumab, a chemotherapy used to treat breast, stomach and esophageal cancers, grew to a 39 percent share in September, but the further increase in savings will come largely when biosimilars for adalimumab come to market in 2023.
“It’s not yet possible to determine the total expense associated with COVID-19 on the health care industry. We know that spend on COVID-related drugs began to decline in the second quarter of last year, but we saw an uptick of $60.5 million over five of the most commonly used COVID-related drugs in the third quarter of 2020 compared to the same quarter in 2019,” said Kistner.
The Vizient Pharmacy Market Outlook is available for download on this resource center, info.vizientinc.com/pharmacy-market-outlook, along with additional cost reduction information.
