The compounded annual growth rate of private market drug costs, at an overall market level, will be in the range of 1.6% to 2.8% between 2013 and 2017, according to a report.
Other key findings observed by Canada’s Research-Based Pharmaceutical Companies (Rx&D), which commissioned the IMS Brogan Private Drug Plan Drug Forecast, include the following:
- Brand patent loss and generic pricing reform will have the largest impact on private plan drug costs, offsetting the incremental cost of new medicines entering the market and the impact of aging.
- The impact of new medicines entering the market is partly offset by the displacement of previous therapies. As such, their cost impact on the total market is mitigated.
- Specialty medicines treat very small patient populations. As a result, the proportional impact of these new products on the total market is also mitigated.
- New cancer medications save lives. Their costs have a relatively small impact on private drug costs, mainly due to the fact that these medicines are often covered by hospitals, cancer care agencies and provincial programs.
- The experience of individual private plan payers may be different from the overall forecast of the private market.
“Individual Canadians, employers, healthcare providers and industry all want the same thing—affordable and predictable drug coverage that allows for access to the right treatment at the right time,” says Russell Williams, Rx&D’s president. “We believe this new information sheds light on questions of affordability and the value that innovative medicines contribute to individual well-being and workplace health and productivity.”
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