Global drug spending set to top $1 trillion
pharmafile | November 20, 2014 | News story | Sales and Marketing |Â Â Gilead, IMS, Kadcyla, Perjeta, drugs, hepatitis C, sovaldi, spendÂ
Worldwide spending on drugs will reach over $1 trillion in 2014 and $1.3 trillion by 2018, according to a new report.
The study by the IMS Institute for Healthcare Informatics, predicts that spending will have increased by 7% from 2013 to $1.06 trillion this year.
This rise is driven mainly by high prices and uptake for several breakthrough cancer and hepatitis C drugs entering the market in developed countries.
This includes Gilead’s hepatitis C pill Sovaldi (Sofosbuvir), Roche’s breast cancer drugs Perjeta (pertuzumab) and Kadcyla (ado-trastuzumab emtansine), Pharmacyclics’s leukaemia treatment Imbruvica (ibrutinib), and Amgen’s myeloma drug Kyprolis (carfilzomib).
Significant advances have been made in these treatment areas, making medicines like these much sought-after. Sovaldi for example can effectively cure hepatitis C in 90% of patients in just 12 weeks, while Kadcyla studies have demonstrated overall survival rates of 30.9 months, compared to 25.1 months for existing treatments.
Drugs like these have faced heavy criticism for their prices, however. NICE and UK charities have hit out at Roche for Kadcyla’s £90,000 per patient price tag, while US insurers have balked at Solvaldi, which costs $1,000 per pill in the country.
The jump in spending is also partly attributed to a decrease of generic drugs entering the market.
Growth will continue
The IMS study also predicts that growth will continue over the next few years as more drugs like these enter the market – in fact, the report estimates that almost 200 new drugs will be launched over the next five years and that $100 billion will be spent on breakthrough hep C treatments alone.
By 2018 global drugs spending will have risen by 30% from 2013 levels to reach $1.3 trillion, according to the report.
So-called ‘pharmerging’ markets will have their part to play in this too, with their spending set to increase by more than 50% by 2018. Population growth and rising incomes will drive drug up drug spending in less developed countries in general.
In fact the only countries that will see a decrease in their pharma spending in this period are France and Spain, due to strict controls designed to cut costs in the wake of the global recession.
George Underwood
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