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2007 Drug Trend
Brian Seiz, PharmDExpress Scripts
2008 Express Scripts, Inc. All Rights Reserved.
2
What Does Express Scripts Mean by “Drug Trend”?
• We report total ingredient cost year over year– Plan design decisions determine cost-
sharing
• We report Express Scripts commercial book of business
• We track specialty separately
2008 Express Scripts, Inc. All Rights Reserved.
3
Lowest Drug Trend Since 1994…
Note: Specialty tracked separately as of 2003
Drug Trend
2008 Express Scripts, Inc. All Rights Reserved.
4
Lowest Drug Trend Since 1994……Record High Generic Fill Rate
Note: Specialty tracked separately as of 2003
GFRDrug Trend
2008 Express Scripts, Inc. All Rights Reserved.
Drug Safety Concerns
One Lesson From Vioxx: Approach New Drugs With CautionBy MARY DUENWALD
October 5, 2004
One Lesson From Vioxx: Approach New Drugs With CautionBy MARY DUENWALD
October 5, 2004
New Avandia study reaffirms heart riskBy Rita Rubin, USA TODAY January 16, 2008
New Avandia study reaffirms heart riskBy Rita Rubin, USA TODAY January 16, 2008
FDA reviewing asthma drug, suicide linkBloomberg News / March 28, 2008
FDA reviewing asthma drug, suicide linkBloomberg News / March 28, 2008
2008 Express Scripts, Inc. All Rights Reserved.
66
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
77
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
Price: The difference in average price per unit of common drugs compared to previous year. Typical drivers include market dynamics and competition.
Price: The difference in average price per unit of common drugs compared to previous year. Typical drivers include market dynamics and competition.
2008 Express Scripts, Inc. All Rights Reserved.
88
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
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Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
1010
Brand Drug Prices UpGeneric Drug Prices Down
Brand Price Drivers:Hypnotics: + 19.2%
Dermatologicals: + 13.5%
Contraceptives: + 10.7%
Brand Price Drivers:Hypnotics: + 19.2%
Dermatologicals: + 13.5%
Contraceptives: + 10.7%
Brands:Prices Up 7.4%
2008 Express Scripts, Inc. All Rights Reserved.
1111
Brand Drug Prices UpGeneric Drug Prices Down
Brands:Prices Up 7.4%
Generic Price Drivers:Antihyperlipidemics: - 38.4%
Antidepressants: - 14.9%
Gastrointestinals: - 14.0%
Generic Price Drivers:Antihyperlipidemics: - 38.4%
Antidepressants: - 14.9%
Gastrointestinals: - 14.0%
Generics:Prices down
3.1%
2008 Express Scripts, Inc. All Rights Reserved.
1212
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
1313
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
Brand/Generic Mix: Reflects the cost impact of increased or decreased generic use. Typical drivers: new generics and maturation of the therapy class
Brand/Generic Mix: Reflects the cost impact of increased or decreased generic use. Typical drivers: new generics and maturation of the therapy class
2008 Express Scripts, Inc. All Rights Reserved.
1414
Top Brand/Generic Mix Changes
Ranked by Percent Change
2008 Express Scripts, Inc. All Rights Reserved.
1515
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
Therapeutic Mix: Changes in the cost per Rx due to use of more or less expensive drugs and drug strengths. Typical drivers include new products replacing old products.
Therapeutic Mix: Changes in the cost per Rx due to use of more or less expensive drugs and drug strengths. Typical drivers include new products replacing old products.
2008 Express Scripts, Inc. All Rights Reserved.
Top Therapeutic Mix Changes
1616
Januvia®
Combo Products
Lyrica®
Lamictal ®
Seroquel ®
Abilify®
Crestor ®
Vytorin®
Prilosec OTC ®
2008 Express Scripts, Inc. All Rights Reserved.
1717
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
1818
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
1919
Utilization = Prevalence + Intensity
0.7%
0.7%
2008 Express Scripts, Inc. All Rights Reserved.
2020
Utilization = Prevalence + Intensity
0.7%
0.7%
1.8%
1.8%
2008 Express Scripts, Inc. All Rights Reserved.
Impact of Utilization on Trend
2121
% Change in Utilization
2008 Express Scripts, Inc. All Rights Reserved.
2222
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
2323
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
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Continued Drop in New Drug Approvals
Lowest approval rate since 1983
U.S. Food and Drug Administration
Ap
pro
ved
New
Mole
cula
r E
nti
ties
2008 Express Scripts, Inc. All Rights Reserved.
2525
Components of Rx Cost Trend*
* Excluding Specialty starting in 2003
2008 Express Scripts, Inc. All Rights Reserved.
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Females Had a Higher Trend on a Higher Base
Trend 5.1%Trend 5.1%
Trend 4.4%Trend 4.4%PMPY
2008 Express Scripts, Inc. All Rights Reserved.
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Children Had aHigher Trend on a Lower Base
PMPY
Trend
5.5%
Trend
5.5%
Trend 6%Trend 6%
Trend
3.3%
Trend
3.3%
Trend 4%Trend 4%
2008 Express Scripts, Inc. All Rights Reserved.
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Top Therapy Classes 2007
2008 Express Scripts, Inc. All Rights Reserved.
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Top Therapy Classes 2007
2008 Express Scripts, Inc. All Rights Reserved.
Therapy Class #1: Lipids
Generics Drove Down Trend
3030
Class Trend: -9.0%
Class Trend: -9.0%
2008 Express Scripts, Inc. All Rights Reserved.
Therapy Class #1: Lipids
Generics Drove Down Trend
3131
Class Trend: -9.0%
Class Trend: -9.0%
2008 Express Scripts, Inc. All Rights Reserved.
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Active Management Drove Down Lipid Trend
2008 Express Scripts, Inc. All Rights Reserved.
Therapy Class #21: Hypnotics
Generics Drove Down Trend
3333
Class Trend: -7.7%
Class Trend: -7.7%
2008 Express Scripts, Inc. All Rights Reserved.
Therapy Class #21: Hypnotics
Generics Drove Down Trend
3434
Class Trend: -7.7%
Class Trend: -7.7%
2008 Express Scripts, Inc. All Rights Reserved.
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Hypnotic Trend Reversed in 2007
2008 Express Scripts, Inc. All Rights Reserved.
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Active Management Drove Down Hypnotic Trend
2008 Express Scripts, Inc. All Rights Reserved.
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Member Share of Costs is Stable
2008 Express Scripts, Inc. All Rights Reserved.
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Member Share of Costs is Stable
2008 Express Scripts, Inc. All Rights Reserved.
Average Copays
2008 Express Scripts, Inc. All Rights Reserved.
Average Copays
2008 Express Scripts, Inc. All Rights Reserved.
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Trend Forecast
5.9%
4.7%
2008 Express Scripts, Inc. All Rights Reserved.
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Trend Forecast
5.9%
4.7%
2008 Express Scripts, Inc. All Rights Reserved.
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Trend Forecast
5.9%
4.7%
6.1%
8.2%
5.6%
7.2%
2008 Express Scripts, Inc. All Rights Reserved.
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An
nu
al S
ale
s $
Bill
ion
Imitrex
LamictalRisperd
al
Fosamax
Effexor XR
Other
ValtrexTopamax
Prevacid
Other
Cozaar/Hyzaar
Lipitor
Other
LevaquinZyprexa
Actos
Protonix
Other
Brand Drugs Going Generic Soon
More than $65 billion within the next five years
Adderall XR Seroquel
Lexapro
Plavix
Singulair
Other
Depakote
FlomaxDiovan/HCT
$13.1 Billion
$10.3 Billion
$13.7 Billion
$9.1 Billion
$19.6 Billion
Other
2008 Express Scripts, Inc. All Rights Reserved.
45
Generic Opportunities Remain Strong
2008 Express Scripts, Inc. All Rights Reserved.
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Generic Opportunities Remain Strong
2008 Express Scripts, Inc. All Rights Reserved.
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Drug Trend Highlights