Looking at Drug Costs Through the Lens of Value

Looking at Drug Costs Through the Lens of Value

07.21.11 | By Kate Connors

A few weeks ago, as I was visiting my family, I took one look at my two-year-old niece and said to my sister, "Mary's diaper needs changing."

"Not it doesn't," she said. "I just got a different brand on sale and they don't attach well, so they hang down a lot."
The poor dear had to waddle her way through a box of them in order to save two dollars.
What does this have to do with The Catalyst? Because in prescription medicines, as in so many other things in life, it's just not right to talk about cost without talking about value.
In terms of cost, trends show that spending on prescription medicines is not skyrocketing, as some may claim. According to IMS Health, prescription drug spending grew 2.3 percent in 2010 and is projected to grow by less than 3 percent annually through 2015.
Patient costs are following a similar trajectory, with IMS recently finding that the average costs for medicines frequently used by Medicare Part D beneficiaries have declined significantly since the implementation of the program.
But more important than these cost figures is the value that the medicines provide. For example, Part D has helped many seniors take their medicines more regularly, thereby better controlling their chronic diseases.
Take diabetes as an example. Regular treatment of the disease can keep it well controlled and can keep patients healthy. Without treatment, however, patients are more apt to face hospitalization, stroke, and even amputation - all painful and costly consequences that no one wants to face.
Another debilitating disease, Alzheimer's, affects millions. According to recent research, nursing home admission of treated Alzheimer's patients is 11 percent after three years, compared to a full 50 percent of patients not receiving medicine for the disease.
Innovative medicines are the result of pioneering scientific work and large-scale investments. They are also important ways to avoid more-expensive intervention, delay hospitalizations, and avert additional expenses - and, ultimately, to keep patients healthy and well.

More On PhRMA — powered by PhRMApedia


Cost in Context