IMS: Growth in Drugs Stalls, Generic Use Up
The IMS institute has released its report on the use of medicines in the United States during 2010. The report looks at consumer spending on prescription drugs, and presents data on how many prescriptions have been filled, in which therapeutic areas, and compares use of generics with branded drugs.
Total spending on drugs was around $307 billion, an increase of 2.3% over 2009, but continuing a trend in declining growth since 2007 and representing only a 0.6% increase on a per capita basis. While branded drugs captured the greatest number of those dollars, $229 billion, this represented a small decrease of 0.7% from the previous year. In contrast, spending on generic drugs grew by 21.7%, and spending on branded generics grew by 4.5%. According to the report, “total branded and unbranded generic market share has risen each of the past five years to now account for 78% of all prescriptions dispensed.”
In today’s cost-conscious environment, generics have grown to be extremely efficient at capturing market share. In 2006, when branded products lost patent protection they still managed to keep 45% of the market share a year later. For 2010, the report indicates that, “within six months of patent loss, patients received the generic form of the molecule 80% of the time.”
The report finds that since 2009, patient office visits have declined by 4.2%, and that the total number of patients beginning a new, chronic therapy has declined by 3.4 million patients. A larger number of prescriptions in 2010 were being filled on Medicare Part D and Medicaid than in the previous year, together accounting for 30.2% of all prescriptions in 2010. Taken together, these findings seem to represent an impact of the poor economy on health care habits and spending.
When broken down by therapy area, the top class of drug in 2010 based on spending was oncologics at $22.3 billion. This spending represents a modest increase of 3.5% over last year, and the lowest level of growth recorded over the past five years. Respiratory agents were second at $19.3 billion, and lipid regulators were third at $18.7 billion, growing by only 0.9% with much of the class available as generics. Antidiabetics were one of the few classes that saw robust growth in spending, up 12.5% to $16.9 billion, with more than half of the growth attributable to increases in spending on human insulin and its synthetic analogs.
Overall, the report finds that while prescription drug use continues to rise, the increases are low compared to years past, and increases in revenues are eaten away by competition from generics. New and innovative medicines will continue to generate large revenues, but the pressure is in on manufacturers to keep a steady supply of premium drugs coming on to the market.