Defining the new dynamics in health care

In 2014, new marketplace dynamics led to double-digit increases in drug spend across the industry, making smart pharmacy benefit management even more vital.

At Prime, three factors accounted for more than 90 percent of all new pharmacy benefit spending:

  • Soaring price increases for all drugs
  • Strong demand for high-cost specialty drugs, such as blockbuster drugs to treat hepatitis C
  • An influx of 1.5 million new Health Insurance Marketplace members with unmet health needs

Decreased generic growth opportunity and increased use across nearly all drug classes also significantly contributed to higher spend.

Defining dynamics: Prime’s 2014 prescription drug cost report

To highlight changing market dynamics and how Prime is helping clients control rising pharmacy spend, Prime has published its 2014 Prescription drug cost report. This is Prime's yearly look at pharmacy costs and spending trends across the commercial book of business.

This year, Prime redefined “drug trend” as the change in net prescription drug costs, which grew 13 percent to $66.67 per prescription in 2014. Costs increased across the industry, and Prime’s costs were no exception. However, since Prime's costs started lower, they ended lower — saving clients nearly $5.50 per prescription.1 

Prime’s unique connections lead to unmatched savings of nearly $5.50 per prescription, when compared to the competitor average.1

Looking forward

The new dynamic in health care is characterized by extremes. Highly targeted, highly effective drugs with extraordinarily high prices will continue to intensify the pressure on already-tight health care budgets. Drug prices will continue to rise to record highs.

It’s not all negative. New, increasingly effective prescription drugs play a central role in treating illness and improving health. Used effectively, these drugs can improve members’ quality of life and productivity. But to maintain affordable access to care for everyone, they must be managed carefully and used appropriately.

We can help you plan and prepare

We offer a wide variety of strategies to fight drug price increases and champion appropriate use. This approach drives the:

  • Best price: Through aggressive negotiation
  • Right drugs: Through evidence-driven policies, formulary (drug list) management, preferred drugs and research-driven benefit design
  • Right place: Through channel management (such as actively managing networks and site of care strategies)
  • Right use: By guiding appropriate utilization from day one, addressing the costs and use of compound drugs, and educating and preparing clients for blockbuster drugs

Our commitment to total cost control will help employers continue to save $4 to $5 per prescription over the competition. Employers that take advantage of programs to fight drug price increases and optimize use could save even more — up to another $5 per prescription.


Unless otherwise noted, all data in this article is from Prime's 2014 Prescription drug cost report.


1. Prime Therapeutics (2009-2014). 2009-2014 Pharmacy Benchmark Study.

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