WASHINGTON – Growth in global prescription drug spending will slow to the lowest rate in decades as low-cost generic drugs continue replacing former blockbusters in the U.S. and Europe, where governments face new pressure to reduce health care spending, according to a new forecast.
The projection from data firm IMS Health shows the global prescription drug market growing by 3 to 6 percent over the next four years to $1.2 trillion by 2017. That compares to a growth rate of 5.4 percent in the last four-year period.
In the U.S., the prescription drug market will actually shrink 1.2 percent in 2013, continuing a multiyear trend that has seen patents expire on many iconic blockbuster drugs, including the anticlotting drug Plavix last year, which was once the world’s second best-selling drug. Growth is expected to slowly resume in 2014 and beyond with the expansion of health care coverage under the Obama administration’s health care overhaul.
IMS’ Institute for Healthcare Informatics calls for drug sales growth in the U.S. between 1 and 4 percent through 2017.
The report paints several scenarios for the U.S. market based on how the plan is implemented. If the plan achieves Obama’s goal of enrolling roughly 30 million uninsured Americans – through expanding Medicaid and individuals enrolling in state insurance exchanges – total U.S. spending on prescription drugs could rise to between $420 billion and $460 billion by 2017. If the plan fails to enroll Americans in significant numbers it could contribute to a decline in demand for medication, and drug spending would be just $300 billion to $320 billion by 2017.