Published May 5, 2021 COVID-19 COVID-19, Other Factors Contribute to Changes in Prescription-Drug Spending By staff Rochester, MN—Not surprisingly, the COVID-19 pandemic had an outsized effect on prescription-drug spending in the United States, according to a new report.The American Society of Health-System Pharmacists (ASHP) National Trends in Prescription Drug Expenditures and Projections for 2021 also points to the increase in biosimilar use, a full pipeline of new cancer drugs, and increased approvals of specialty medications.The report, released ahead of print by the American Journal of Health-System Pharmacy (AJHP), notes that prescription drug spending in 2020 grew at a modest 4.9% rate to $535.3 billion. Most of the growth, 2.9% of the 4.9%, was linked to increased utilization, while spending on new drugs, 1.8%, and price changes, 0.3%, also contributed to the rise.“Reflecting the overarching impact of COVID-19 on healthcare, ASHP’s drug expenditures report illustrates the factors that can impact hospital and health-system budgets,” said Daniel J. Cobaugh, PharmD, vice president of publishing at ASHP and editor-in-chief of AJHP. “We provide this annual report to help hospital and health-system leaders, policy makers, and others understand drug expenditure patterns to anticipate future growth and spending.”In nonfederal hospitals, drug expenditures spiked in the 3 weeks immediately following the March 8, 2020, lockdown but then declined 4.6%, reflecting a 19-week low point before rebounding. Without the volatile early weeks of the pandemic, the authors point out, hospital drug spending would have shown moderate growth compared with 2019. Dollars devoted to pharmaceuticals increased in home-care settings by 13%, however.Three drugs were at the top of the list for overall spending:• Immunosuppressive adalimumab for immune disorders such as arthritis and Crohn's disease • Apixaban, a treatment to prevent blood clotting in patients with atrial fibrillation • Insulin glargineEric Tichy, PharmD, MBA, division chair, supply-chain management at the Mayo Clinic in Rochester, Minnesota, was the lead author of the report. He suggests that many effects of the pandemic are likely to persist in 2021 and could also have a significant effect on drug expenditures into 2022. “Hospital and health-system pharmacy leaders should expect to continue suffering from drug expenditure whiplash in 2021 and beyond as they manage the implications from COVID-19, including the commercial availability of new high-cost drug therapies and shifts in site of care throughout the evolution of the pandemic,” Dr. Tichy said.The report also advises that, as drugs approved under emergency-use authorizations transition to full FDA approval, expenditures for agents like remdesivir and monoclonal antibody cocktails will move from the federal government to where care is delivered. It notes that remdesivir was only commercially available for the final 3 months of 2020 but exceeded expenditures for all drugs in nonfederal hospitals and suggests that new drugs for the management of COVID-19 likely will have an effect on future spending.Prescription drug expenditures at hospital and healthcare systems also are expected to get a “rebound” effect resulting from higher utilization of acute-care services related to patients’ reluctance to get preventive care during the pandemic.In terms of other factors, the authors posit that expected approvals of new biosimilars for adalimumab, ranibizumab, and pegfilgrastim in 2021 and 2022 will increase competition and could cause further reductions in expenditures.The extensive pipeline of new cancer drugs, development of treatments for rare diseases, and expected FDA approval for a range of specialty drugs also will have an impact, they write. The report discusses how increased spending on specialty drugs continues to outstrip the rest of the market and could exceed 50% of overall drug expenditures in 2021. On the other hand, an expected push by payers to implement site-of-care restrictions will move more use of high-cost specialty drugs out of hospitals and into lower-cost sites, including ambulatory infusion centers and home care.The content contained in this article is for informational purposes only. The content is not intended to be a substitute for professional advice. Reliance on any information provided in this article is solely at your own risk. « Click here to return to Weekly News Update.