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 percent of total health spending. While brand medicine manufacturers produce 100 percent of new medicines, they account for only half of medicine spending, or 7 percent 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.