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Understanding Prescription Medicine Spending

PhRMA January 25, 2019

Medicines play a central role in transforming the trajectory of many debilitating diseases, reducing mortality and improving health outcomes and quality of life for patients. Today, prescription medicines account for just 14% of total health spending. While brand medicine manufacturers produce 100% of new medicines, they account for only half of medicine spending, or 7% of total spending on health care. Over the next decade, many novel medicines will further transform patient care, yet medicines are projected to remain a small and stable share of total health spending. Discussion of prescription medicine spending needs to consider five key facts.

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