Medical Pharmacy Trend Report™ delivers insights, forecasting in 12th edition

Discover the latest trends and emerging strategies to manage rising medical benefit specialty drug spend

December 14, 2022

EAGAN, Minn. – Dec. 14, 2022 – Magellan Rx Management (Magellan Rx), a Prime Therapeutics LLC (Prime) company, released its 12th annual Medical Pharmacy Trend Report™, featuring a comprehensive view of provider-administered medical benefit drug trends — one of the largest drivers of total specialty drug spend. This report offers detailed analysis of medical benefit drug claims, data benchmarks and current medical benefit drug management strategies.

2022 key insights and trends

Oncology continued to be the top spend category, accounting for 39%, 53%, and 27% of Commercial, Medicare and Medicaid spend respectively, and replaced gene therapy as the top concern for payers in 2021.

  • Since 2019, oncology biosimilars have contributed to an estimated 7% reduction in total oncology per member per month (PMPM) spend for Commercial markets. The estimated reduction in total oncology PMPM spend for the government markets was a 1.6% and 0.5% reduction in Medicare and Medicaid markets respectively.
  • Historically, the year-over-year PMPM trend ranged from 6% to 17% across all three lines of business. In 2020 to 2021, the increase was 3.2%, 2.7%, and 0% for Commercial, Medicare, and Medicaid respectively.

In the Commercial space, claim volume had the highest influence on aggregate trend, due to more patients receiving medical drug therapy in 2021 versus 2020.  In government programs, allowed per-claim costs had the largest impact on aggregate trend due to patients receiving more of the higher cost medical drug therapies in 2021 versus 2020. Looking forward, spend is forecasted to increase over the next three years, mainly driven by oncology and high-cost, novel molecular entities in the rare disease category.

The report highlights how medical drug spend trend across Commercial, Medicare, and Medicaid lines of business has been influenced by the COVID-19 pandemic. The restrictions resulted in a sharp drop in utilization of less-expensive drugs, while utilization of more-expensive therapies remained constant. Drug utilization remained consistent in oncology but dropped in oncology support. Overall utilization began to rebound in 2021; however, pre-pandemic levels were not reached.

“The past four years have been unprecedented in health care. There has been a tremendous change due to the introduction of gene therapies, biosimilar market entrants, and a global pandemic, all dramatically influencing trends for medical benefit drugs,” said Kristen Reimers, RPh, senior vice president, specialty clinical solutions for Magellan Rx Management. “The complexity in medical drug spend continues to be an important factor when caring for patients with complex specialty medical conditions. The Medical Pharmacy Trend Report supports those looking to prioritize strategies specific to specialty and medical pharmacy drugs.”

The annual Medical Pharmacy Trend Report is just one of the ways Magellan Rx keeps the industry updated on the latest trends for medical benefit drugs. To learn about Magellan Rx’s more than 17 years of experience and commitment to developing innovative clinical programs that address these trends and help payers proactively improve overall cost and quality, read about the company’s total specialty drug management approach and medical pharmacy solutions.

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