The Facts Always Missing in Drug Pricing Reporting

  • by: Robert Goldberg |
  • 03/28/2018

Two articles, one in Axios and the other on repeat the drug prices are unsustainable narrative without providing the following facts necessary for balanced reporting:

1.  As drug spending has increased since 1990, the rate of increase in spending on other health services has declined. 

2.    As drug spending as a percent of health care spending has increased, out of pocket drug costs have declined

3.    Increases in drug spending are strongly associated with the introduction of new medicines with significant health benefits. 

3.    The consumption of new medicines is associated with a decline in the rate of spending for other health care services. 

The chart above shows that as new medicines are introduced the rate of spending on other services goes down. 

In sum,  we are spending more on prescription drugs and reducing the rate of spending on other services while out of pocket drug costs (except for a significant minority being exploited by PBMs and plans) has substantially decreased. 

Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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