CVS reports dramatic drop in Rx spending growth after 2014's double-digit spike
- CVS Health on Tuesday reported slowing growth in prescription drug spending among its members in 2015. Prescription drug spending per member per month increased only 5% last year, compared to an increase of 11.8% in 2014.
- In particular, CVS pointed toward inflation in non-specialty drug brands as a key driver of spending growth. High-volume branded drugs like those for diabetes contributed more than specialty drugs generally.
- However, the new data only measured drug spending for members of CVS Health's pharmacy benefit manager CVS Caremark. While Caremark is a major PBM, other large PBMs like Express Scripts or Optum RX may see different spending trends.
CVS accredited its pharmacy management strategies and formulary options as instrumental in reducing client costs. The company claimed its approach reduced trend growth by 50%.
The 5% increase in drug spending seen by CVS Health compares favorably to the overall 12% increase in drug spending over 2015, as Reuters reports. Continued increases in drug prices have underpinned increasing blowback against the high cost of drugs from lawmakers and patients.
This criticism been aimed at the entire industry, but a number of companies such as Gilead and Valeant Pharmaceuticals have been called out in particular. Gilead's highly-effective, but pricey hepatitis C treatments helped fuel the double-digit growth measured by CVS in 2014. And just this week, CVS said it plans to limit the use of Valeant's toe fungus drug Jubila, which costs $1,000 per bottle.
CVS Health used a metric called "prescription drug trend" to calculate these results. The metric measures the growth in prescription spending per member per month, and takes into account drug prices, utilization, and negotiated rebates.
Follow Ned Pagliarulo on Twitter